Which IMF facility provides rapid financial assistance to member countries facing urgent balance of payments needs due to natural disasters, commodity price shocks, or other exogenous shocks?
- Extended Fund Facility (EFF)
- Rapid Financing Instrument (RFI)
- Stand-By Arrangement (SBA)
- Flexible Credit Line (FCL)
Answer: Rapid Financing Instrument (RFI)
The RFI offers quick-disbursing, low-conditionality support for urgent needs. It can be used for natural disasters, commodity price volatility, or post-conflict situations, providing liquidity while countries design longer-term adjustment programs with IMF support.