Crunch European talks to end the standoff over Greece's debt ended without a deal on Thursday, as the IMF warned Athens it would get no leeway to meet a payment at the end of the month and avoid default.
The clock ticked closer to midnight on the crisis after eurozone finance ministers meeting in Luxembourg failed to reach a breakthrough on a reform deal that could avert a catastrophic Greek exit from the euro.
"No deal at Eurogroup," Valdis Dombrovskis, the European Commission vice-president for the euro, said after the talks broke up after 90 minutes of discussion on Greece.
He said it was a "strong signal for Greece to engage seriously in negotiations."
One source described the talks outcome to AFP as "tragic".
EU President Donald Tusk quickly announced an emergency summit of the leaders of the 19 eurozone countries on Monday in Brussels, saying it was "time to urgently discuss the situation of Greece at the highest political level."
The summit comes before a meeting of all 28 EU leaders on Thursday and Friday.
Leftist Prime Minister Alexis Tsipras has refused to make reforms to pensions and VAT rates demanded by the creditors in exchange for extending Greece's huge EU-IMF bailout.
Creditors have refused to pay the remaining 7.2 billion euros of the bailout if there is no reform deal, and the cash will be lost forever if there is no deal for an extension.
- Greek 'catastrophe' -
Eurogroup chief Jeroen Dijsselbloem told a press conference that time was running out and said the "ball is clearly in the Greek court".
Economic Affairs Commissioner Pierre Moscovici meanwhile urged a "reasonable compromise" to avoid a "catastrophe" involving Greece.
Failure to get the bailout cash would leave Greece unable to repay 1.6 billion euros to the IMF on June 30, the same day that the bailout expires.
"There will be no period of grace" for the loan payment, the IMF's Lagarde told reporters before she joined the ministers for their Eurogroup meeting.
"I have a term of June 30 -- if it's not paid by July 1, it's not paid."
Europe's most powerful leader, German Chancellor Angela Merkel, weighed in on the issue earlier Thursday when she told German lawmakers she was "still confident" that a deal was possible.
But the mood was darker in an overcast Luxembourg, where ministers were openly broaching scenarios such as a Greek exit from the euro if it defaults on its debts.
"The next step to make the deal credible, also financially sustainable, will have to come from the Greek side," Dijsselbloem said.
Greek Finance Minister Yanis Varoufakis, the motorbike-riding former economist whose relations with his counterparts have been strained, said he wanted to "replace costly discord with effective consensus."
- Greece Plan B? -
Without the bailout tranche and the IMF deadline missed, Greece would be for the first time in five years financially alone, with its coffers empty and all eyes on what happens next.
"The other option is to prepare the B plan," said Irish finance minister Michael Noonan, adding that he did not fear any "contagion effect" in the case of a "Grexit" -- meaning Greece crashing out of the euro.
Finnish Finance Minister Alex Stubb added: "Option number 1 is extension …. Option B could be default."
Greece's central bank warned for the first time Wednesday that the country could suffer a "painful" exit from the single currency area -- and even the European Union -- if it fails to reach a deal.
Greece has another 6.7 billion euros due to the European Central Bank in July and August and there have been reports of planning for possible capital controls if Greece's financial system runs dry.
Elected in January on a vow to end five years of bailout-imposed austerity, Tsipras warned Wednesday that an EU "fixation" with pension cuts would scupper a deal and harm Europe as a whole.
In a move that seemed calculated to irk other European leaders amid tensions with Russia over Ukraine, Tsipras visited Saint Petersburg Thursday as the star guest at President Vladimir Putin's investment drive forum.