Special Drawing Rights (SDRs) are an artificial currency instrument created by the International Monetary Fund, which uses them for internal accounting purposes.
The value of the SDR is based on a weighted basket of major currencies, including the US dollar, euro, Japanese yen, Chinese yuan and British pound.
The SDR interest rate (SDRi) serves as the basis for calculating the interest rate charged to members when they borrow from the IMF and paid to members for their remunerated creditor positions with the IMF.
SDRs are allocated based on the quota sums of each member country. The higher the quota, the more SDR the country will receive. In general, stronger economies have higher quotas.
SDRs can be used to exchange for other currencies, repay loans, pay liabilities, collateral, pay interest on loans, or pay for increases in allowances.