Flexible Credit Line (FCL) (IMF)

The Flexible Credit Line (FCL) was a new credit line for countries with very strong fundamentals, policies, and track records of policy implementation. Access to the FCL credit line was made useful for crisis prevention purposes. This facility was recently accessed by Mexico, Poland and Colombia. The FCL is for countries with very strong fundamentals, policies, and track records of policy implementation and is useful for both crisis prevention and crisis resolution. FCL arrangements are approved, at the member country’s request, for countries meeting pre-set qualification criteria. The length of the FCL is one or two years (with an interim review of continued qualification after one year) and the repayment period the same as for the SBA. Access is determined on a case-by-case basis, is not subject to the normal access limits, and is available in a single up-front disbursement rather than phased. Disbursements under the FCL are not conditional on implementation of specific policy understandings as is the case under the SBA as FCL-eligible countries are trusted to be able to implement appropriate macroeconomic policies. There is flexibility to either draw on the credit line at the time it is approved or treat it as precautionary. In case a member draws, the repayment term is the same as that under the SBA. (Source:IMF)