European Financial Stability Facility (EFSF)

Updated: Aug 20, 2021

The EFSF was created by the eurozone member states in 2010, as a temporary crisis resolution mechanism, to safeguard the financial stability of the eurozone by financing loans to eurozone member states. The funds for the loans are obtained from the European Commission through the European Financial Stability Mechanism, from the Intemational Monetary Fund, and from issuing bonds on the capital market. The EFSF can act after receiving a request from a eurozone member state that is unable to borrow on the open market at an acceptable rate. In 2011 the EFSF made loans to Ireland and Portugal, and its final assistance programme, to Greece, expired in June 2015. See also European Stability Mechanism.

Reference: Oxford Press Dictonary of Economics, 5th edt.

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James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.