The BRICS currency reserve, like the IMF, would serve to safeguard member countries from economic turbulence — like the 2008 global economic crisis — and help cover budget deficits when they arise. The development bank, like the World Bank, would dole out loans to countries in the developing world for contracts to supply equipment and expertise for the project.

At the same time, the IMF and World Bank have refused to grant the emerging world — the BRICS countries included — greater voting power to reform these institutions, even though emerging economies now contribute substantial funding. As South Africa’s former Finance Minister Pravin Gordhan put it: “The roots of the World Bank and IMF still lie in the post–World War II environment.”

When a country applies for cash from the World Bank or IMF, it agrees to a set of structural adjustment policies (SAPs) designed to close budget gaps — measures like cutting domestic spending, ending subsidies or freezing wages. Critics say these programs curtail the development and diversification of a country’s domestic industries in favor of export production to the West. Some have likened the relationship to an iteration of neocolonialism.

“The biggest safeguard is that BRICS is composed of very divergent countries who have had a very hard time reaching agreements, even on how to finance the bank,” said John Perkins, an ardent critic of the IMF and World Bank and author of the book “Confessions of an Economic Hitman.” “Because of these divergent objectives and the political philosophies of these countries, there’s real hope they will make sure these loans are not used for political reasons.”

But unlike the U.S. and Europe, who are in lockstep on most things, the BRICS countries have little in common but a shared ambition to rebalance the global economic order.

To economists in the developing world, who have long criticized the World Bank and IMF as anathema to the countries they purport to help, the New Development Bank holds tremendous promise. Critics say the West has taken advantage of its monopoly in international lending to wield outsize influence in the economic and political affairs of developing countries, dictating development models that further entrench these countries' subservience to the West.

The BRICS nations first announced their plans for the bank in March 2013 but struggled to reach an agreement over China’s desire to hold a greater stake in the institution. But a Brazilian government official told Reuters last week that the five members were ready to split funding and control equally, clearing the last major hurdle for a launch in 2016.

The BRICS nations — Brazil, Russia, India, China and South Africa — are reportedly close to finalizing their long-awaited development bank and currency reserve, each valued at $100 billion, in what has been billed as a historic challenge by the world’s emerging economies to a global financial architecture that has been dominated by the U.S. and Western Europe since its post–World War II inception.

After more than six decades of dictating development policy in much of the emerging world, the Western-led International Monetary Fund and World Bank may soon have some competition.

But unlike their Western equivalents, the BRICS would offer loans that don’t require the implementation of SAPs or other lender-imposed stipulations. "The bank will look into the finances of borrowers, but never intervene in their economic affairs,” the Brazilian official told Reuters. In other words, the BRICS are proposing an unprecedented no-strings-attached alternative to international lending.

At least to begin with, the new bank will be only a minor competitor. The BRICS can’t compete with the liquidity of the $755 billion IMF or the 66 years of development experience under the belt of the World Bank. For those reasons, it may not be surprising that the World Bank president himself said he “welcomed” the unprecedented venture, calling the bank a “natural extension of the need for more investment in infrastructure” than the World Bank can provide.

For now, said Rachel Ziemba, director of emerging markets at Roubini Global Economics, “the BRICS' goals are less about replacing the IMF and World Bank and more about supplementing them."

But in the past few months, the West has been engaged in a tug-of-war with Russia over the crisis in Ukraine. Russia has responded by inking an unprecedented $400 billion gas deal with China to shift energy exports away from Europe. And Russia’s second-biggest financial institution announced it would bypass the U.S. dollar as reserve currency in its dealings with the Bank of China.

In light of all the talk about an emerging “rebalance” of the world order, some say the BRICS' challenge has taken on new meaning. In a column he co-authored for Project Syndicate, the former chief economist of the World Bank, Nobel laureate Joseph Stiglitz, has cited the imperative for “rebalancing” and fresh perspectives from the emerging world in arguing that the BRICS bank was “clearly needed.”

“Confessions of an Economic Hitman” author Perkins added that the bank could be the first major challenge to U.S. financial hegemony since the Soviet Union folded in 1991. “During the Cold War, countries in Africa, Latin America, the Middle East who felt bullied by the U.S. could turn to the Soviet Union, pressuring the U.S. to moderate its tactics. Today, we’re starting to see a new consciousness about the need for another balancing power.”

In order to rise to such lofty expectations, the BRICS will now set their sights on expanding membership in the bank by permitting any country to join with a $100,000 share.

But for all the charges of modern-day colonialism lobbed against the West, it isn’t clear who would be willing to align with such a diverse coalition as the BRICS. It's hard to name a country that hasn’t had a run-in of some sort with one of its members. For example, even if the BRICS bank had the funds to offer a country like Ukraine the massive bailout it recently accepted from the IMF (it doesn't), Kiev likely wouldn't want a loan that came, in part, from Russia.

And there is rising concern about the motivations of China, which for decades has been lending easy money to many African countries that have a deep-seated wariness about Western meddling. Beijing has financed at least $128 billion in African development projects since 2000, and it has done so without interfering in domestic affairs.

But many Africans are concerned that the relationship has begun to take a neocolonial turn as China invests in the extraction of Africa’s vast resources and opens new markets for selling its manufactured goods. The then-governor of Nigeria’s Central Bank, Mallam Sanusi Lamido Sanusi, made headlines last year when he warned Africans to shake off their “romantic view of China,” which he called “an economic giant capable of the same forms of exploitation as the West.”

The bank is supposedly going to be split between the five BRICS, according to the latest reports, which would keep Chinese ambitions in check. But China's economy is 20 times the size of South Africa’s and four times that of Russia or India, and economists say it is a certainty that China will continue to press for greater influence within the BRICS bank. Should the other members fail to contain their most powerful partner, the bank’s very premise would seem to be diminished.

“People in Latin America have been saying for years that they’d rather take loans from China than the U.S. to a large degree, because China does not have a history of overthrowing governments and assassinating leaders,” said Perkins.

“But they also know that by accepting loans they’re giving China a foothold into their countries to behave like the U.S. It just hasn’t happened yet.”