The objective of policy-based financing is to promote and support the adoption of impactful policy and institutional reforms with significant implications for socioeconomic development, such as those designed to catalyze systemic change, enhance institutional effectiveness or efficiency, enable private development, and foster inclusive, sustainable growth and poverty reduction.
Programmatic PBF consists of a series of two or more PBF operations, each structured as a single-tranche financing and approved sequentially, with indicative triggers guiding the transition from one operation to the next.
Examples: A progressive strengthening of a country’s tax and social protection systems through a sequenced reform program focused on fiscal sustainability, institutional effectiveness, and social inclusion.
Lending rate: SOFR base rate + IDB Ordinary Capital variable lending spread:
SOFR base rate is USD SOFR daily overnight compounded rate + IDB's funding margin.
Funding margin for 1st quarter 2026 is 41 bps.
IDB’s Ordinary Capital lending spread - for 2026 is 80 bps.
Fees: Commitment fee 50 bps: applicable on undisbursed loan amount and starts to accrue 60 days after loan contract signature.
Interest and Currency conversion options are available.
For applicable loan charges and conversion option fees, please refer to www.iadb.org/rates
Deferred drawdown option (DDO)
A deferred drawdown option (DDO) can be requested for all PBL modalities. The DDO allows the deferral of the disbursement (up to 3 years, renewable for another 3 years) after the completion of the policy actions for a fee.
Flexible repayment options subject to a maximum maturity of 20 years, and maximum Weighted Average Life (WAL) of 12.75 years.
Standard Grace Period: 5.5 years.
Standard amortization schedule (semiannual, straight-line payments), bullet repayment structures, extended grace periods, uneven amortization schedules, and shorter repayment periods are available without additional cost.
All financial terms for PBLs applies to DDO except for:
Upfront fee: 50bps; Commitment fee: 38bps.
Post-disaster response activities
Immediate Response Facility for Emergencies caused by disasters
(IRF)
Risk of investment projects
Partial Credit Guarantees
(PCG)
Sovereign non-performance risks leading to debt default
Political Risk Guarantees
(PRG)
Investments with defined objectives and scopes
Specific Investment Loans
(ESP)
Contingent credit line for immediate response after a disaster
Contingent Credit Facility for Natural Disaster and Public Health Emergencies
(CCF)
Results of an existing or new government program
Results-Based Loans
(LBR)
Small independent investment projects
Multiple Works Financing
(GOM)
Loans to small and medium-size enterprises
Global Credit Financing
(GCR)
Transfer of technical know-how
Reimbursable Technical Cooperation
(TCR)
Project's preparation and start of activities
Projects Preparation, Execution and Evaluation Facility
(PROPEF)
Credit line with a framework for a series of operations
Conditional Credit Line for Integrated Projects
(CCLIP)
Investment Financing with Deferred Drawdown Option
Investment Financing with Deferred Drawdown Option
(IF-DDO)
Investment Guarantee
Investment Guarantee
(GUA)