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Purpose |
Provide assistance to countries experiencing serious payment
imbalances because of structural impediments or slow growth and an
inherently weak balance-of-payments position.
Support comprehensive programs with a focus on policies needed to
correct structural imbalances over an extended period. |
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Eligibility |
All member
countries facing actual or potential external financing needs. Most
often used by advanced and emerging market countries, but low-income
countries sometimes use the EFF together with the Extended
Credit Facility (ECF). |
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Conditionality |
Countries’ policy commitments expected to focus on structural
reforms to address institutional or economic weaknesses, in addition
to policies to maintain macroeconomic stability.
Disbursements conditional on the observance of quantitative
performance criteria. Progress in implementing structural measures
that are critical to achieving the objectives of the program is
assessed in a holistic way, including via benchmarks. See more on conditionality. |
|
Review
modalities |
Periodic
reviews of policies and program implementation, as access to IMF
resources occurs in tranches (phasing). The IMF’s
Executive Board regularly assesses program performance and can
adjust the program to adapt to economic developments. |
|
Terms |
Duration |
Typically
approved for periods of 3 years, but may be approved for periods as
long as 4 years to implement deep and sustained structural reforms. |
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Repayment |
Over 4½–10
years in 12 equal semiannual installments. |
|
Interest rate |
The lending rate comprises:
-
Surcharges, which depend on the amount and time that credit is
outstanding. A surcharge of 200 basis points is paid on the
amount of credit outstanding above 187.5 percent of quota.
If credit remains above 187.5 percent of quota after 51 months,
this surcharge rises to 300 basis points. Surcharges are
designed to discourage large and prolonged use of IMF resources.
Resources are subject to a commitment fee levied at the beginning of
each 12-month period on amounts that could be drawn in the period
(15 basis points for committed amounts up to 115 percent of quota,
30 basis points on committed amounts above 115 percent and up to 575
percent of quota and 60 basis points on amounts exceeding 575
percent of quota). Fees are refunded pro rata if amounts are drawn
during the course of the relevant period. If a country borrows the
entire amount, the fee is fully refunded.
A service charge of 50 basis points is applied on each amount drawn. |
|
Access |
Two types:
-
Normal access. On
March 6, 2023 , the annual
limit was temporarily raised for a year to 200 percent of
quota for any 12‑month period and the cumulative limit over the
life of the arrangement net of repayments was raised to 600
percent of quota.
-
Exceptional access.
Decided on a case-by-case basis under the Exceptional Access
Policy.
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EFFs generally
are not formulated on a precautionary basis in anticipation of a
future balance of payments problem. |
