Guyana Development Bank to go into full operation in October

As the Government prepares to launch the Guyana Development Bank in October, it has begun steps to appoint a Board of Directors.

On Wednesday, Minister of Finance, Dr. Ashni Singh, signed the Commencement Order to operationalise the Guyana Development Bank.

He said the Commencement Order marks another critical step in the institution’s journey ahead of its October 5 launch.

“That now sets the stage, starting from October, the operationalising of the Guyana Development Bank, and we are already putting, at the governmental level, all of the prerequisites in place. We will be appointing a board; we will be appointing a senior management; we will be appointing staff,” Minister Singh said.

Minister Singh said a number of key persons have already been identified to aid in the bank’s effective functioning from the time it is launched.

The Guyana Development Bank Bill was piloted through the National Assembly by Minister Singh earlier this year.

A first tranche of US$100 million ($20 billion) will be injected at start-up, representing half of the Bank’s authorized capital of $40 billion.

The Guyana Development Bank is expected to transform the financing landscape for Small and Medium- sized Enterprises (SMEs) and entrepreneurs in Guyana, especially to the benefit of women, youth, and persons with disabilities, offering zero-interest loans of up to $3 million with no collateral required.

Mentorship and training services would also be provided to ensure beneficiaries are equipped with the requisite knowledge and skills to run successful businesses.

Minister Singh said under a co-financing arrangement, borrowers would be able to unlock additional financing of up to $7 million from traditional lending institutions, at favourable interest rates.

“We are going to be working with the commercial banks to establish in key strategic bank locations, a desk within the commercial banks to work with them so persons can go in and submit their applications. We are going to be working in collaboration with the commercial banks so persons can graduate from the development bank unto the full financial system and get perhaps a full loan from the established commercial banks,” Minister Singh said.

Further, the Bank’s operational structure will facilitate the creation of consortia among beneficiaries, providing opportunities for scaling, specialisation, and risk-sharing.

In a statement, the Ministry of Finance said the principles of transparency, accountability and sustainability are hard coded into the Bank’s operational framework through relevant legislative provisions. It was explained that strategic direction would be provided by the Board with members suitably qualified across the fields of finance, economics, banking and law, with the latitude to execute broad management functions.

The Bank’s legal architecture was also designed to promote effective risk management, while fostering institutional continuity.

The entity’s financial records will be subject to annual examination by the Auditor General, and an annual report on operations would have to be prepared and presented to the people and National Assembly of Guyana.