Regarding the International Monetary Fund, which one of the following statements is correct?

Answer: (c) It grants loans to only member countries

IMF financing is a right of its members. Under the Articles of Agreement, each member can use the Fund's general resources in proportion to its quota. The Fund deals with a member only through that member's own fiscal agencies, such as its Treasury or central bank. A country that is not a member has no such access, so the IMF lends only to member countries.

• ✗ (a) The IMF cannot lend to just any country. Access to its general resources is a right of members, linked to their quotas. Non-members have no such claim.
• ✗ (b) The Articles do not limit lending to developed countries. Any member with a balance-of-payments need can use IMF resources, whatever its level of development. Developing countries are in fact the main borrowers, including through concessional lending windows.
• ✓ (c) The Articles give each member the right to use the Fund's general resources in proportion to its quota, subject to the Fund's conditions. Lending is therefore confined to member countries.
• ✗ (d) The borrower is the member country itself. Its central bank is only one of the agencies, along with the Treasury, a stabilisation fund or a similar fiscal agency, through which the member deals with the Fund. This channel exists only for members, so the IMF cannot lend to the central bank of just any country.

Remember · The IMF lends only to its member countries, in proportion to their quotas and subject to conditions. A member deals with the Fund through its Treasury, central bank or a similar fiscal agency.

Question: UPSC Civil Services (Preliminary) 2011, General Studies paper. Explanation: Minimalist IAS, checked 25 Oct 2026 (how we verify). · Report an error