Term:
Escrow accounts
Definition:
In the context of external debt payments, accounts typically held in banks outside of the debtor country through which a portion of the export proceeds of a debtor is channeled. Typically involve balances of one-year maturity to cover future debt-service payments. Creditors who are the beneficiaries of such accounts thus obtain extra security for their loans and effective priority in debt service.
Domain:
Finance
Source:
IMF, 2003, External Debt Statistics: Guide for Compilers and Users – Appendix III, Glossary, IMF, Washington DC