Instruments

The Bank offers an array of instruments, including loans and grants, to finance efforts to improve water supply and sanitaion (WSS) services around the world. The Bank has two types of lending instruments:

• Investment Lending that finances goods, works, and services. Investment loans are disbursed against specific foreign or local expenditures related to the investment project, including pre-identified equipment, materials, civil works, technical and consulting services, studies, and incremental recurrent costs.
• Development Policy Lending is rapidly disbursing policy-based financing. Funds are disbursed in one or more stages (tranches) when the borrower complies with stipulated release conditions, such as the passage of reform legislation, the achievement of certain performance benchmarks, or other evidence of progress.

In addition, a small part of Wolrd Bank Group support to the WSS sector is provided through  WB guarantee instruments, and by  IFC and  MIGA.

Increasingly, scaled-up support to the WSS sector is delivered through Poverty Reduction Support Credits (PRSCs). PRSCs are a kind of development policy lending designed to support government implementation of the PRSP in IDA countries. PRSCs offer a good opportunity to harmonize donor support, as financing is channeled directly through national budgets. This kind of budget support is combined with capacity building and technical assistance to achieve sustainable results. The list of PRSCs that include support to the WSS sector is expanding.