Finance Minister Michael Noonan has said a deal on the Anglo promissory note was "likely" before the end of March.
The next €3.1 billion installment falls due then.
Speaking as he arrived for a meeting of EU finance ministers in Brussels, Mr Noonan said: "Because a deal is likely, the Government is unlikely to pay."
Mr Noonan said there was good will towards Ireland on the issue, but there were still a number of legal hurdles that had to be overcome.
He was echoing remarks by the ECB president Mario Draghi in Frankfurt last week.
"I've said on a number of occasions that the political deadline on us is March 31 when the next payment is due, and I have also said that it would be very difficult for Ireland to pay the money on that date, so we're working towards a deal and we hope we get a deal," he said.
Mr Noonan was speaking ahead of an Ecofin meeting at which it is hoped the framework of a new Europe-wide banking supervision system can be forged, as the first part of a wide-ranging EU banking union.
Only once a ''Single Supervisory Mechanism'' (SSM) is in place and is proving effective will the permanent EU bailout fund, the ESM, be able to directly recapitalise banks in such a way as to take the burden off a state's books.
The Government has been pressing on this issue since the June 29 summit in Brussels, during which euro zone leaders agreed to provide support for the Irish financial situation.
The Government hopes the ESM can be used to retroactively tackle some €30 billion of bank debt relating to the recapitalisation of Bank of Ireland, AIB and Permanent TSB.
"There is a commitment to Ireland and that commitment was reinforced in bilaterals between the Taoiseach and the German Chancellor and the French President. So we'd be hoping as the year goes by that we can get into serious discussions,'' Mr Noonan said today.
The Government has said that the possibility for the ESM to help alleviate Ireland's legacy bank debt burden and the question of the Anglo promissory notes were two separate issues.
Meanwhile, a two-day summit of EU government leaders starting tomorrow will seek to build on the results of the finance ministers' meeting.
EU Commission President Jose Manuel Barroso told legislators that a big effort will be needed to achieve progress on the issue by the weekend.