Lending

$165 billion to 83 countries, including $16.1 billion to 49 low-income countries

About $91 billion in financing to 80 countries, including $11.3 billion to 48 low-income countries since the onset of the pandemic in late March and as of September 15, 2020.

Out of this lending*, the IMF channeled $30 billion (equivalent to SDR 21.2 billion) in financing to 69 countries through emergency lending facilities.

The IMF provides financing to member countries experiencing actual, potential, or prospective balance of payments problems to help them rebuild their international reserves and restore conditions for strong economic growth, while correcting underlying problems. The IMF also provides emergency financing and has massively stepped up such financing to help member countries address the immediate impact of the COVID-19 pandemic.

*Lending information covers May 1, 2019–September 15, 2020.

Unlike development banks, the IMF does not lend for specific projects. Instead, IMF financing is meant to help member countries tackle balance of payments problems, stabilize their economies, and restore sustainable economic growth. IMF financing can also be provided in response to natural disasters or pandemics. Finally, the IMF also provides precautionary financing to help prevent and insure against future crises and continues to enhance the tools available for crisis prevention.

In broad terms, the IMF has two types of lending—loans provided at nonconcessional interest rates and loans provided to low-income countries on concessional terms. Currently, concessional loans do not bear any interest.

The IMF has responded to the COVID-19 pandemic with unprecedented speed and magnitude, making use of its current $1 trillion lending capacity.¹

This response has entailed provision of financial assistance to countries with urgent or potential balance of payments needs with the aim to help protect the lives and livelihoods of people, especially the most vulnerable. Between the onset of the pandemic in late March and September 15, 2020, about $91 billion (or SDR 64 billion) has been committed to 80 member countries, of which $30 billion was emergency financing (RCF and RFI). On the lending front, actions have focused on five tracks:

1. Emergency financing under the RFI and RCF

   The IMF is responding to a record number of requests for emergency financing—from 69 countries as of September 15, 2020. The Board temporarily doubled the access limits to the emergency facilities—the Rapid Credit Facility (RCF) and Rapid Financing Instrument (RFI)—allowing it to meet the expected immediate demand from member countries (see RFI and RCF agreement details on Access Limits in the interactive lending map above). These facilities allow the IMF to provide emergency assistance without the need for the member to have a full-fledged program in place.

2. Augmenting existing lending arrangements

   The IMF is also augmenting existing lending programs to accommodate urgent new needs arising from the coronavirus, thereby enabling a response to the COVID-19 crisis within the context of the ongoing policy dialogue. Augmentation requests have been approved by the Board for eight countries as of September 15, 2020.

3. New lending arrangements, including precautionary arrangements

   The Board approved six new IMF-supported programs to five countries to mitigate the economic and social impact of the crisis while maintaining macroeconomic stability. In addition, Flexible Credit Lines (FCLs) were made available for three countries with very strong policy frameworks and track records in economic performance. (In all three cases, the authorities intend to treat their respective arrangements as precautionary.)

4. Enhancing liquidity

   The Board approved the establishment of a Short-Term Liquidity Line (SLL) to further strengthen the global financial safety net (see Table 2.1 on Financial Terms Under IMF General Resources Account Credit). The facility is a revolving and renewable backstop for member countries with very strong policies and fundamentals in need of short-term moderate balance of payments support.

5. Debt relief

   In March 2020, the Catastrophe Containment and Relief Trust (CCRT) was enhanced to provide debt relief on a grant basis to the IMF’s poorest members affected by the COVID-19 pandemic. Twenty-nine eligible countries² have received debt service relief of SDR 344 million in two six-month tranches, which were approved by the Executive Board on April 13, 2020 and October 2, 2020, respectively.

The Board has also temporarily streamlined the internal processes to allow the IMF to respond more quickly to members’ requests for emergency assistance during the COVID-19 pandemic, and in many cases the IMF made financing available within weeks of a request for emergency financing. In addition, the Board has also temporarily suspended the application of high-access procedures for RCF requests.³

Policy safeguards were introduced in August 2020 to help mitigate financial risks from a member having high levels of combined high access from both the Poverty Reduction and Growth Trust and General Resources Account lending facilities. Under the new policy, safeguards apply to any Fund member with combined access to GRA and PRGT resources that exceeds quota-based thresholds set at the same level that triggers the exceptional access framework of the GRA.

1. Including pre-pandemic commitments, as of September 15, 2020, total undisbursed lending commitments and credit outstanding under the IMF’s GRA lending were about SDR 174.9 billion, while the corresponding total under the Poverty Reduction and Growth Trust, which provides concessional lending to low-income countries, was about SDR 14.4 billion.
2. Chad is one of 29 countries approved to benefit from the CCRT debt service relief. However, the first tranche of CCRT relief covers debt service falling due during April 13-October 13, 2020, during which Chad does not have any debt service to the IMF falling due. Hence, no CCRT relief was disbursed to Chad during this period.
3. High-access procedures require an informal Board session based on a short staff note that includes discussion of program strength, capacity to repay, and debt vulnerabilities. The high-access procedures are triggered when (1) a request for Fund financing brings total access to more than 180 percent of quota over a 36-month period or (2) total outstanding credit from the PRGT exceeds or is projected to exceed 225 percent of quota.