standby arrangement

international finance

Written by

The Information Architects of Encyclopaedia Britannica

Last updated

July 14, 2026

Quick Summary

A standby arrangement is an agreement between a country and the International Monetary Fund (IMF) that provides a country with access to IMF financial resources. This arrangement is typically used to help countries facing balance of payments problems, allowing them to borrow funds to stabilize their economies. The IMF establishes parities for exchange rates, and countries agree to keep their currency's fluctuations within a certain range. If a currency's value falls outside this range, the country's monetary authorities must intervene in the foreign exchange market to maintain the agreed-upon limit. The "Group of Ten" countries, for example, have historically provided standby credits to support the IMF system.1

Summary created from Britannica articles using AI. AI can make mistakes, so verify using Britannica articles.

2 Britannica Sources

Ask Britannica AI about this topic

Britannica doesn't have a full article on this topic, so we've curated a list of our relevant coverage.

International Monetary Fund
Financing balance-of-payments deficits
…providing these loans, including a standby arrangement, which makes short-term assistance available to countries experiencing temporary or cyclical balance-of-payments deficits; an extended-fund facility, which supports medium-term relief; a supplemental-reserve facility, which provides loans in cases of extraordinary short-term deficits; and, since 1987, a poverty-reduction and growth facility. Each facility
Read More
…providing these loans, including a standby arrangement, which makes short-term assistance available to countries experiencing temporary or cyclical balance-of-payments deficits; an extended-fund facility, which supports medium-term relief; a supplemental-reserve facility, which provides loans in cases of extraordinary short-term deficits; and, since 1987, a poverty-reduction and growth facility. Each facility
Read More