Credit rate. The loan rate includes (1) the Merchant Special Draw Interest Rate (SDR), which has a minimum floor of 5 basis points, and a margin (currently 100 basis points), known as base interest rates, and (2) mark-ups that depend on level and time pending. An increase of 200 basis points out of 187.5% of the quota is paid on the amount of the outstanding. If the credit remains above 187.5 per cent of the quota after three years, this increase will increase to 300 basis points. These increases are intended to prevent significant and prolonged use of IMF resources. Structural adjustment programmes have long been criticized as excessive savings measures in the recipient country in exchange for financial assistance. These criticisms have been less pronounced in recent years, particularly since 2009, when the IMF`s SBA policy was modified to better meet the needs of recipient countries. Greece, which came close to a sovereign debt crisis in 2010 and 2011, may be an exception. The resulting significant reductions in public spending led to mass protests and riots. In this case, there is growing criticism of the requirements for euro membership, as significant financial aid also comes from other euro area countries, not from an IMF confirmation regime. [2] [3] [4] The SBA framework allows the Fund to respond flexibly to countries` external financing needs and support their adjustment policy through short-term financing.

Terms of credit . Access to IMF funds under the SBAs is guided by the need for financing, repayment capacity and a balance sheet of IMF resources. Under these guidelines, the SBA provides flexibility in loan amounts and the date of disbursement. These include: . A precautionary fit. Countries that are in high need for funding and do not intend to use authorized amounts, but retain the ability to do so when they need them, have precautionary measures to ensure high access. When a country borrows from the IMF, it agrees to adjust its economic policy to overcome the problems that have led it to seek financing. These obligations, including specific conditions, are described in the country`s Memorandum of Understanding. In the event of an economic crisis, countries often need financial resources to help them overcome their balance-of-payments problems.

Since its inception in June 1952, the IMF Confirmation Agreement (SBA) has been the lending instrument of emerging and developed countries. The SBA was revalued in 2009, along with the fund`s broader framework, to be more flexible and meet the needs of Member States. Conditions have been streamlined and simplified and more resources have been released upstream. The reform also allows for wider access to wider access on the basis of a precautionary basis. Quantitative conditions. Member States` progress is monitored on the basis of quantitative targets (quantitative performance criteria and indicative targets). Payments of funds are subject to meeting quantitative performance criteria, unless the board of directors decides to waive them. For example, targets for international reserves and government deficits or borrowings in line with program objectives.

Building on previous efforts, the IMF has continued to reform the conditions of its lending operations, focusing on measurable, observable and regular audits, the frequency of which is based on the strength of the country`s policy and the nature of its financing needs: eligibility. All Member States facing real or potential external financing needs are eligible for IMF policy SBAs.