What kind of financial assistance does the IMF offer?

Unlike development banks, the IMF does not lend for specific projects. Instead, the IMF provides financial support to countries hit by crises to create breathing room as they implement policies that restore economic stability and growth. It also provides precautionary financing to help prevent crises. IMF lending is continuously refined to meet countries’ changing needs.

Crisis transparent

Why do crises occur?

The causes of crises are varied and complex. They can be domestic, external, or both.

Domestic factors include inappropriate fiscal and monetary policies, which can lead to large current account and fiscal deficits and high public debt levels; an exchange rate fixed at an inappropriate level, which can erode competitiveness and result in the loss of official reserves, and a weak financial system, which can create economic booms and busts. Political instability and weak institutions also can trigger crises.

External factors include shocks ranging from natural disasters to large swings in commodity prices. Both are common causes of crises, especially for low-income countries. With globalization, sudden changes in market sentiment can result in capital flow volatility. Even countries with sound fundamentals can be severely affected by economic crises and policies elsewhere.

The COVID-19 pandemic was an example of external shock affecting countries across the globe. The IMF responded with unprecedented financial assistance to help countries protect the most vulnerable and set the stage for economic recovery.

Crises can take many different forms. For instance:

Balance of payment problems occur when a nation is unable to pay for essential imports or service its external debt.

Financial crises stem from illiquid or insolvent financial institutions.

Fiscal crises are caused by excessive deficits and debt.

Often, countries that come to the IMF face more than one type of crisis as challenges in one sector spread throughout the economy. Crises can slow growth, increase unemployment, lower incomes, and create uncertainty, leading to a deep recession. In an acute crisis, defaults or restructuring of sovereign debt may be unavoidable.


The IMF provides financial assistance and works with governments to ensure responsible spending.

The IMF offers various types of loans that are tailored to countries' different needs and specific circumstances. Loans to low-income countries carry a zero interest rate. 

How IMF lending helps 

IMF lending gives countries breathing room to adjust policies in an orderly manner, paving the way for a stable economy and sustainable growth. Policy adjustments will vary depending on the country’s circumstances. For example, a country facing a sudden drop in the price of key exports may need financial assistance while moving to strengthen its economy and diversify its exports. A country facing severe capital outflows may need to restore investor confidence by addressing the problems that led to capital flight —perhaps interest rates are too low, the budget deficit and debt are growing too fast, or the banking system is inefficient or poorly regulated.

Without timely IMF financing, a country’s adjustment process may be more abrupt and difficult. For example, if investors are unwilling to provide new financing, the country may suffer a painful compression of government spending, imports, and economic activity. IMF financing facilitates a more gradual adjustment. Because IMF lending usually is accompanied by a set of corrective policy actions, it signals that appropriate policies are being put in place, encouraging the return of private investors. IMF lending also aims to protect the most vulnerable population via policy conditionality. In low-income countries, IMF lending is also typically meant to catalyze financial support from other donors and development partners.

The IMF lending process is flexible. Countries that maintain a commitment to sound policies may be able to access resources with no or limited conditionality. The same is true for certain urgent and immediate needs covered by emergency financing instruments.

IMF lending in action


First, a member country in need of financial support makes a request to the IMF.


Then, the country’s government and IMF staff discuss the economic and financial situation and financing needs.


Typically, a country’s government and the IMF agree on a program of economic policies before the IMF lends to the country. In most cases, a country’s commitments to undertake certain policy actions, known as policy conditionality, are an integral part of IMF lending.


Once the terms are agreed upon, the policy program underlying an arrangement is presented to the IMF’s Executive Board in a “Letter of Intent” and detailed in a “Memorandum of Understanding.” The IMF staff makes a recommendation to the Executive Board to endorse the country’s policy intentions and offer financing. This process can be expedited under the IMF’s Emergency Financing Mechanism.


After its Executive Board approves a loan, the IMF monitors how members implement the policy actions underpinning it. A country’s return to economic and financial health ensures that IMF funds are repaid so that they can be made available to other member countries.


IMF lending instruments

The IMF has several lending instruments to meet the different needs and specific circumstances of its members. 

IMF members have access to the General Resources Account on non-concessional terms (market-based interest rates), but the IMF also provides concessional financial support (currently at zero interest rates) through the Poverty Reduction and Growth Trust, which is better tailored to the diversity and needs of low-income countries. The recently established Resilience and Sustainability Trust offers longer-term financing to low-income and vulnerable middle-income countries seeking to build resilience to external shocks at affordable interest rates. 

Reflecting different country circumstances and challenges, GRA-supported programs are expected to resolve the country’s balance of payments problems during the program period, while PRGT programs envisage a longer duration for addressing them. The RST provides financing to address longer-term challenges, including climate change and pandemic preparedness.


The IMF’s finances

The IMF’s lending arrangements with countries

Weekly summaries of financial assistance to member countries






Present, prospective, or potential balance of payments need



Up to 3 years but usually 12-18 months

Ex-post, and ex-ante (prior actions) if needed



1 to 3 years

Protracted balance of payments need/medium-term assistance



Up to 4 years

Ex-post, with focus on structural reforms. and ex-ante (prior actions) if needed



3 to 4 years, extendable to 5 years

Urgent balance of payments need/emergency financing assistance



Outright purchase

No reviews /ex-post conditionality, but ex-ante (prior actions) possible



Outright disbursement

Present, prospective, or potential balance of payments need (very strong fundamentals and policies)



1 or 2-year

Ex-ante (qualification criteria) and annual reviews for the 2-year arrangements

Potential moderate short-term balance of payments needs arising due to capital account pressures (very strong fundamentals and policies)



Approved for a period of 12 months with successor SLLs possible

Ex-ante (qualification criteria)

Present, prospective, or potential balance of payments need (sound fundamentals and policies)



6-month (liquidity window) or 1 or 2-year

Ex-ante (qualification criteria) and ex-post

Longer-term prospective balance of payments need or balance of payment need created with policies 



Minimum duration 18 months, cannot exceed the concurrent UCT-quality program

Ex-post, concurrent IMF 

UCT-quality program 


Non-financial/signaling instruments

SMP1 (incl. PMB)


6 to 18 months, longer durations not precluded

Ex-post, and ex-ante (prior actions) if needed



6 months to 4 years

Ex-post, and ex-ante (prior actions) if needed

This instrument does not require the IMF Executive Board’s approval.

Does the IMF charge for its loans?

All IMF members have access to financial support through the General Resources Account (GRA), which is subject to various charges. These charges are designed to cover the operational costs of the IMF and support its activities, including those related to providing policy advice and capacity development to member countries.

Basic charges: based on the market-determined Special Drawing Rights (SDR) interest rate – which has a minimum floor of 5 basis points – plus a margin established by the IMF Executive Board every two years (currently 100 basis points). 

Surcharges: high and prolonged borrowing of non-concessional resources is subject to surcharges. There are two types:

  • Level-based surcharges: of 200 basis points are applied on the portion of GRA credit outstanding greater than 187.5 percent of quota;
  • Time-based surcharges: of 100 basis points are applied on the portion of credit exceeding the threshold for more than 36 months (51 months in case of borrowings under the Extended Fund Facility (EFF)). Read more in this FAQ.

Commitment fee: applied to the undisbursed portion of a loan. This fee is typically a small percentage of the loan amount. For most IMF lending instruments the fee is 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. 

Commitment fees are refunded to the borrowing member, in proportion to the drawings made. If a country borrows the entire amount, the fee is fully refunded. Additional commitment fees and/or refunds may also apply under certain circumstances, for example whenever arrangements access amounts or periods are increased or decreased or cancelled.

Service charge: a fixed charge on each amount drawn from the GRA (currently at 50 basis points, except for the Short-term Liquidity Line (SLL) which has a reduced rate of 21 basis points). For detail on each type of non-concessional loan, see Stand-by Arrangement (SBA), Extended Fund Facility (EFF), Flexible Credit Line (FCL), Precautionary and Liquidity Line (PLL), Short-term Liquidity Line (SLL), and Rapid Financing Instrument (RFI).

This page was last updated in July 2023