Bank’s main functions to lend the money to the needy members. For lending activities, it needs money and therefore it has to borrow.
Sources : The Bank borrows from the following sources :
- The Bank borrows from international market both for long and short periods.
- The Bank also borrows under Currency Swap Agreements (CSA).
- The Bank also borrows under the Discount-Note Programme by two methods. First, it places bonds and notes directly with its member countries. Second, it offers issues to investors and in public markets.
Two new borrowing instruments were evolved by the Bank. The first one is Central Bank
Facility and US dollar dominated facility. The World Bank borrows from the Central Banks of the member countries. The second instrument is Floating Rate Notes. The World Bank borrows from the commercial banks and other financial institutions with the help of these instruments.