[1] Repayment plans are prominent within the financial industry of a national economy where liquid funds are in high demand to assist in investment opportunities, governmental expenditure or personal finance.
[2] Repayment plans have historically existed within the economies of the developed world where the financial markets are more established and have expanded over a longer period of time.
[5] By issuing loans, the International Monetary Fund and the receiving nation agree upon a pre-specified repayment strategy called a 'system of conditionality'.
However, creditors do not always have a regard for individual circumstances which can violate personal financial stability, which can lead to further issues which do not necessarily have to be accounted for by credit providers.
The collapse of the Greek national economy following the 2007–2008 financial crisis, resulted in political instability, social exclusion and economic 'brain-drain' in Greece.
[10] Government policy and reform spanned 12 rounds of tax increases, spending cuts and a number of bailout loans by the International Monetary Fund and the Eurogroup in the years 2010, 2012 and 2015.
However, conditions of the recession had worsened despite the austerity measured implemented at the time, leading to a 7.1% fall in national GDP and a rise in unemployment from 7.5% in late 2008 to 19.9% in November 2011.
[16] This coincided with greater investor confidence in the Greek economy, which showed positive signs of recovering economic growth and a reduction in national debt.
A Graduated Repayment Program lets the borrower make smaller payments back toward their student loans at the start of their new term.
Federal loans are subjected to fixed interest rates, no credit checks and option to have the type of repayment plan selected.
For individuals who are unable to budget, or contain expenses, entering and thereafter completing repayment plans can be extremely difficult and result in poverty, bankruptcy or homelessness.