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IBRD Financial Products

IBRD Flexible Loan

  • The IBRD Flexible Loan (IFL) is the leading loan product of the World Bank for public sector borrowers of middle-income countries. Eligible borrowers work with their World Bank country office to obtain financing for development through Investment Project Financing, Development Policy Financing,  Program-for-Results, or any combination of those by a Multiphase Programmatic Approach, and use the IFL as their loan product.

    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 the grace period. The maximum weighted average maturity or average repayment maturity (ARM) is 20 years.

    What is the cost of IFL?

    The cost of the IFL reflects IBRD's AAA credit rating and is stable and transparent. Components of the pricing include the interest rate, front-end fee, and commitment fee.

    The interest rate consists of a market-based variable reference rate and a spread (variable or fixed).  A one-time front-end fee of 0.25% is charged on the committed loan amount, and a commitment fee of 0.25% per annum paid semi-annually is charged on the undisbursed balances, which begins to accrue sixty days after the loan agreement is signed. Countries are classified into four pricing groups based on income and other factors. Please refer to the IBRD Flexible Loan Pricing Basics product note for information on IBRD USD, EUR, JPY, and GBP lending rates and charges or consult our Lending Rates & 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?

    The IFL includes conversion options to manage currency and/or interest rate risks over the life of the loan. These options are embedded in the loan agreement and can be executed at a borrower's request at any time. In line with their debt management strategy requirements or changing market conditions, IFL borrowers have the option to change from a floating to a fixed interest rate or vice versa. The IFL also offers the flexibility of using interest rate caps or collars to manage interest rate volatility. Similarly, IFL provides a currency conversion option for hard currencies as well as specific local currencies.

    How to select the financial terms for your IFL? - Loan Choice Worksheet (LCW)

    To prepare for the IFL, World Bank project manager, the World Bank country office, and the borrower's representative in charge of selecting financial terms, review the preparatory package to choose the suitable financial terms. The package consists of the Loan Choice Worksheet (LCW), instructions for the LCW, and an informational letter to the borrower with a more detailed explanation of the options available. The worksheet serves as the basis for the preparation of the applicable draft legal documentation.

    LCW in Francais, Portugues and Espanol

    Instructions for LCW in Francais, Portugues, and Espanol. 

    You can tailor the repayment schedule of IBRD loans to meet specific project or portfolio needs. Determine if the customized schedule falls within IBRD maturity limits (20 years average repayment maturity and 35 years final maturity) using the Amortization Schedule Analyzer (ASA) available through Client Connection

    For a complete list of frequently asked questions about IFL, read more. For more information about IFL, contact Miguel Navarro-Martin, Manager of Banking Products.

  • The IFL includes conversion options to manage currency and/or interest rate risks over the life of the loan. These options are embedded in the loan agreement and can be executed at a borrower's request at any time.

    Currency Conversions:

    Interest Rate Conversions:

    • Fixing/Unfixing rates and spreads: Borrowers have the option of fixing or unfixing the reference rate and/or fixing the variable spread portion of the withdrawn (disbursed) loan amount. The IFL offers the following types of interest rate conversions: (a) From variable-rate to fixed-rate and vice versa by requesting an interest rate conversion; (b) From a variable rate based on a variable spread to a variable rate based on a fixed spread by requesting an interest rate conversion to fix the spread; (c) From a variable rate based on a reference rate and the variable spread to a variable rate based on a fixed reference rate and the variable spread or vice versa by requesting to fix the reference rate.
    • Interest Rate Caps/Collars: For IFLs with a fixed spread the borrower may opt to cap (set an upper limit) or collar (set upper and lower limits) on the variable lending rate (i.e., the reference rate plus the fixed spread) for up to the entire disbursed amount. For IFLs with a variable spread, the borrower may opt to cap (set an upper limit) or collar (set upper and lower limits) on the reference rate portion of the lending rate for up to the entire disbursed amount. Borrowers can choose this option by requesting to set interest rate caps or collars.
    • Automatic Rate Fixing: The borrower may direct IBRD to undertake automatic rate fixings through interest rate conversions, executed at regular time intervals, or upon certain levels of disbursements. The borrower may exercise this option on all or part of the amounts to be disbursed by requesting automatic rate fixing and also cancel this automatic rate-fixing arrangement at any time.

    Note: IFLs with a variable spread that are subject to the General Conditions dated July 31, 2010, or earlier require an amendment to the loan agreement to fix and unfix the reference rate or to employ a cap or collar on the reference ration portion of the lending rate while maintaining the variable spread.

    Requesting Conversions:

    To request a loan conversion, borrowers must refer to the Bank Directive and Bank Guidance on conversions and fill out the relevant conversion request form(s) below, and send it to

    For any questions related to conversions, borrowers can contact the Financial Advisory and Banking team at any time (

    IBRD will make reasonable efforts to execute approved conversions within 15 business days. During the approval process, the borrower may be contacted for more information or clarification.

    Currency Conversion Forms:

    Interest Rate Conversion Forms:

    Transaction Fees: Expressed as a percentage per annum on the outstanding loan amount unless otherwise indicated.

    Transaction Type

    For Fixed and 
    Variable Spread Loans

    Interest Rate Conversion


    EUR(1), JPY(1)

    Rate fixings of disbursed amounts



    Interest Rate Caps/Collars of disbursed amounts

    On a case-by-case basis

    Currency Conversion

    Of undisbursed loan amounts (2)


    Of disbursed loan amounts

    Changing from variable spread to fixed spread


    Note: For loans for which the Libor/Euribor + Spread is lower than zero during the current interest rate period, transaction fees will be calculated on a case-by-case basis.

    (1) Currency of the loan prior to the Conversion.

    (2) Expressed as a percentage of the principal amount involved, and payable as a lump sum.

    (3) The variable spread over the reference rate may be changed to a fixed spread over the reference rate, but not vice-versa. Such “fixing” of the variable spread will be effected based on the fixed spread applicable to the loan prevailing at the time of the request. The fixed spread of the converted loan will consist of:

    • The prevailing projected USD funding spread to the reference rate, the market risk premium, and the basis swap adjustment (for loans denominated in EUR and JPY) based on the average remaining maturity of the converted loan
    • The original contractual lending spread of the converted loan
    • The original maturity premium (if applicable) of the converted loan
    • A transaction fee of 0.03 % per annum

    Transaction Fees for Early Termination: For early termination of a Conversion (a currency, or interest rate conversion) a transaction fee of 2bp p.a will apply. Transaction fees expressed as a percentage per annum will be converted to a lump sum.

  • The General Conditions are incorporated by reference in all loan, credit, guarantee, and financing agreements. Specific provisions of the General Conditions are also incorporated in other legal agreements. Read more about the General Conditions

    General Conditions for IBRD Financing