Development Credit Authority (DCA)

Functional Series 200 – Programming

Document Quality Check Date: 02/21/2013
Partial Revision Date: 08/21/2012
Responsible Office: GC/C
File Name: 249_022113

Overview

*Development Credit Authority (DCA) is the legislative authority that permits USAID to issue partial loan guarantees to private lenders to achieve the economic development objectives in the Foreign Assistance Act of 1961, as amended (FAA). DCA also authorizes USAID to make direct loans. Through its DCA authority, USAID works with investors, financial institutions, and development organizations to design and deliver investment alternatives that enable financing for U.S. Government priorities. DCA guarantees require true private sector risk-sharing. As a matter of policy, it is preferable to have 50 percent risk sharing in order to ensure sound due diligence by the private lender. The investment or risk of USAID in any one development activity may not exceed 80 percent with respect to any one tranche of the total outstanding investment or risk.