Civil Services Prep

Prelims 2022 · Economy · Question 1

"Rapid Financing Instrument" and "Rapid Credit Facility" are related to the provisions of lending by which one of the following?

  1. Asian Development Bank
  2. International Monetary Fund
  3. United Nations Environment Programme Finance Initiative
  4. World Bank

Answer

International Monetary Fund

  • (a) Asian Development Bank: ADB has its own lending windows and emergency support facilities, but Rapid Financing Instrument (RFI) and Rapid Credit Facility (RCF) are not ADB terms. Verdict: Incorrect.
  • (b) International Monetary Fund: RFI and RCF are IMF emergency lending instruments; RFI is for urgent balance-of-payments needs, and RCF is the concessional window for low-income countries. Verdict: Correct.
  • (c) United Nations Environment Programme Finance Initiative: UNEP FI is a partnership platform on sustainable finance, not a sovereign emergency lender using RFI/RCF. Verdict: Incorrect.
  • (d) World Bank: The World Bank provides development financing through IBRD/IDA and crisis-response tools, but RFI/RCF are not World Bank lending facilities. Verdict: Incorrect.
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