Where the IMF Gets Its Money

April 19, 2018

Resources for IMF loans to its members on non-concessional terms are provided by member countries, primarily through their payment of quotas. Multilateral and bilateral borrowing serve as a second and third line of defense, respectively, by providing a temporary supplement to quota resources. These borrowed resources played a critical role in enabling the IMF to support its member countries during the global economic crisis. The IMF’s current total resources amounting to SDR 975 billion translate into a capacity for lending or “firepower” of about SDR 700 billion (around US$ 1 trillion), after setting aside a liquidity buffer and considering that only quota resources of members with strong external position are used for lending.

Quotas

Quotas are the IMF’s main source of financing. Each member of the IMF is assigned a quota, based broadly on its relative position in the world economy.

The IMF regularly conducts general reviews of quotas to assess the adequacy of overall quotas and their distribution among members. The latest review (the 14th Review) was concluded in 2010 and the quota increases became effective in 2016. This review doubled quota resources to SDR 477 billion (about US$692 billion). On December 5, 2016, the Board of Governors adopted a Resolution calling on the Executive Board to work expeditiously on the 15th Review in line with existing Executive Board understandings and the guidance provided by the IMFC, with the aim to complete the 15th Review by the Spring Meetings of 2019 and no later than the Annual Meetings in the fall of 2019.

Multilateral Borrowing

New Arrangements to Borrow

  • 40  participants
  • Total size SDR 182 billion (US$264 billion)
  • Activation requires support from 85% of creditors eligible to vote
  • Activated ten times between April 2011 to February 2016
  • Last activation ended in February 2016
  • Renewed for an additional five-year period through November 2022

Through the New Arrangements to Borrow (NAB) a number of member countries and institutions stand ready to lend additional resources to the IMF. The NAB constitutes a second line of defense to supplement IMF resources to forestall or cope with impairment of the international monetary system. Concurrent with the quota increases under the 14th Review, the NAB was rolled back from SDR 370 billion to SDR 182 billion in February 2016. In a more limited set of circumstances, the General Arrangements to Borrow (GAB) with 11 participants and an associated borrowing arrangement with Saudi Arabia enable the IMF to borrow up to SDR 18.5 billion through the end of the current GAB period, December 25, 2018.

Bilateral Borrowing Agreements

2016 Bilateral agreements

  • 40 participants with approved 2016 Borrowing Agreement
  • Total commitments of about SDR 316 billion (US$460 billion)
  • Activation of the agreements requires support from 85% of creditors eligible to vote
  • Common initial term to end-2019, extendable to end-2020 with consents from lenders

Bilateral Borrowing Agreements serve as a third line of defense after quotas and the NAB.

Since the onset of the global financing crisis, the IMF has entered into several rounds of bilateral borrowing agreements to ensure that it could meet the financing needs of its members. In 2016, in view of continued uncertainty in the global economy, the membership committed to maintain access to bilateral borrowing, under a revised borrowing framework, with an initial term through the end of 2019 extendable for a further year with creditors’ consents.


Concessional lending and debt relief for low-income countries are financed through separate contribution-based trust funds.