World Bank Reopens IBRD $10k to $10m No Collateral Loan
World Bank Reopens IBRD $10k to $10m No Collateral Loan The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for capital projects.
The World Bank is the common name for the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), two of the five international organizations that belong to the World Bank Group.
World Bank IBRD $10,000 to $10m. unsecured is a flexible loan (IFL) and the World Bank’s flagship loan product for public borrowers in middle-income countries.
What We Do
A key area of the World Bank Group’s work is to improve SMEs’ access to finance and find innovative solutions to unlock sources of capital.
Our approach is holistic, combining advisory and lending services to clients to increase the contribution that SMEs can make to the economy including underserved segments such as women owned SMEs.
~ world bank
Advisory and Policy Support for SME finance mainly includes diagnostics, implementation support, global advocacy and knowledge sharing of good practice. For example we provide;
IFL offers:
- Long maturities – up to 35 years
- Market-based interest rates reflecting IBRD’s AAA credit rating
- Flexibility to tailor repayment terms
- Embedded tools to manage currency or interest rate risk over the life of the loan
What are the maturities in IFL?
IFL’s maximum final maturity is 35 years, including a grace period. The maximum weighted average maturity or average repayment maturity (ARM) is 20 years.
What is the cost of IFL?
IFL’s price reflects IBRD’s AAA credit rating and is stable and transparent. Pricing elements include interest rate, upfront fee and commitment fee.
The interest rate consists of a variable market-based reference rate and a variable spread. There is a one-time fee of 0.25% of the committed loan amount and a commitment fee of 0.25% per annum, payable semi-annually on unpaid balances, which begins to accrue sixty days after the loan agreement is entered into. undersigned.
Countries are classified into four price groups based on income and other factors. For information on IBRD USD, EUR, JPY and GBP borrowing rates and fees or see our borrowing rates and fees.
How does the IFL help borrowers customize the repayment terms?
The IBRD Flexible Loan (IFL) allows borrowers to customize repayment terms (i.e., grace period, repayment period, and amortization profile) to meet debt management or project needs. For example, if the objective is to reduce the overall refinancing risk of the debt portfolio, a borrower may choose repayment terms that smooth out the debt service profile.
This flexibility can also be used in investment operations to match repayment terms to a project’s expected cash flows. Borrowers can find the most up-to-date information on IBRD Flexible Loan in the Major Terms and Conditions product note.
How does the IFL help manage financial risk?
IFL includes conversion options to manage currency and/or interest rate risks over the course of the loan. These options are built into the loan agreement and can be exercised at any time at the request of the borrower. I
In accordance with the requirements of their debt management strategy or changing market conditions, IFL borrowers have the option to switch from a variable reference rate to a fixed reference rate or vice versa.
IFL also offers the flexibility to use interest rate caps or collars to manage interest rate volatility. Similarly, IFL offers a currency conversion option for hard currencies as well as specific local currencies.
How to choose the financial terms for IFL? – Loan Selection Worksheet (LCW)
To prepare the IFL, the World Bank project manager, the World Bank country office and the borrower’s representative responsible for the selection of the financial terms must review the preparation package to select the relevant financial terms.
The package consists of the Loan Selection Worksheet (LCW), instructions for the LCW and an information letter to the borrower with a more detailed explanation of the options. The worksheet serves as a basis for preparing current drafts of legal documentation.
Instructions for LCW in Francais, Portugues and Espanol.
Borrowers can adjust the World Bank’s IBRD repayment schedule for $10,000 to $10 million.
Determine if the customized schedule falls within IBRD’s maturity limits (20 year average repayment duration and 35 year final maturity) using the Amortization Schedule Analyzer (ASA) available via client login
World Bank Reopens IBRD $10k to $10m No Collateral Loan
