An acronym for stand-by arrangement; an economic program (lending facility) of the International Monetary Fund (IMF) whereby a financial aid is extended to a member state (country) in need of financial assistance, usually at the time of extreme need (such as a financial crisis). It is one of the IMF’s credit arrangements aiming to provide short‐term financial assistance for countries passing through financial difficulties.

This program was introduced in 1952 in order to finance up to a specified amount as a remedy to short-term or cyclical balance of payments difficulties. Indebted countries are requested to repay the loans over a period of one to two years (extending up to three years in specific situations) after disbursement. Repayment takes place normally on a quarterly basis, subject to a condition that the member state’s meets clear-cut performance criteria, such as monetary and budgetary targets. The set conditions allow both the member state and the IMF to monitor and evaluate the progress being made in policy implementation. Ongoing monitoring of implementation may necessitate further the imposition of other corrective policies.