The World Bank has announced that it will eliminate several lending fees to make borrowing more affordable for vulnerable countries.
The move is part of a broader effort to expand financial capacity and address urgent global challenges, including climate change, inequality, and economic vulnerability.
The Global Bank made this known on Tuesday through a link posted on its official X-handle. Clicking on that link reveals that it has eliminated the prepayment premium on International Bank for Reconstruction and Development loans, introduced a grace period for commitment fees on unpaid balances, and applied a minimum price to small and fragile states.
“The bank is working hard to make it easier for countries to borrow and to pay back their loans more easily by removing some fees on IBRD loans,” the financial institution stated.
These changes, according to the financier, aim to ease financial pressure on nations most in need of development financing.
“These measures are designed to make borrowing easier and more affordable for countries facing significant challenges,” the bank said. It added that the reforms align with its vision of building a “better, more efficient, and bigger” institution capable of addressing overlapping global crises.
The fee eliminations are part of the World Bank’s broader financial reforms, which aim to increase lending capacity by $150bn over the next decade.
This will be accomplished through innovative financial products, leveraging shareholder support, and optimizing available capital, and IBRD has assured that these measures will not compromise its triple-A credit rating.
The reforms also included an adjustment to IBRD’s capital adequacy ratio, which was reduced from 20% to 18%, allowing for approximately $70 billion in additional financing over 10 years.