The official name of World Bank is the International Bank for Reconstruction and Development (IBRD). It was established in 1945, the World Bank’s initial goal was to help finance reconstruction of the European economies. With the assistance of the Marshall plan the World Bask accomplished this task by the mid 1950’s. It then adopted a new mission to build the economies of the world’s developing countries.
The World Bank is an international financial institution dedicated to reducing poverty around the world through capital investment and the facilitation of trade. It is playing main role of providing loans for development works to member countries, especially to underdeveloped countries. The World Bank provides long-term loans for various development projects of 5 to 20 years duration.
Member countries repay the share amount to the World Bank in the following ways:
- 2% of allotted share are repaid in gold, US dollar or Special Drawing Rights (SDR).
- Every member country is free to repay 18% of its capital share in its own currency.
- The remaining 80% share deposited by the member country only on demand by the World Bank.