By Theon Alleyne, CRCP, CCEP | Georgetown, Guyana | 31 July 2026
ANALYSIS | BANKING & COMPLIANCE
The Guyana Development Bank lends G$3 million. Commercial co-financing adds up to G$7 million. Section 5(2)(b) confers a bare power to co-finance carrying no amount, no rate and no obligation.
The Guyana Development Bank Act 2026 received presidential assent on Thursday. Its headline facility is G$3 million at zero interest with no collateral, on terms the Act permits rather than requires. The figure most often quoted, however, is G$10 million, and that number depends on a second institution entirely. Under the co-financing arrangement, an approved borrower uses the State facility to unlock up to G$7 million more from participating commercial banks at preferential rates.
Seventy per cent of the package therefore sits with lenders the Act addresses in a single clause.
What does the Act require of the commercial tier?
Section 5(2)(b) confers a power to co-finance. It carries no amount, no rate and no obligation. Nothing in the Act sets terms for the commercial portion, requires any bank to participate, or specifies what happens to a borrower approved by the State and declined at the second counter.
The State tier is not heavily regulated either, but it is regulated. Section 25 compels written credit policies addressing eligibility criteria, risk assessment, approval thresholds, monitoring and recovery. Whatever those policies say, they must exist and they must cover those subjects. La Caribeña News has set out what the Act requires and what it leaves unpublished in a separate account of the legislation.
The tier holding thirty per cent of the money has statutory credit policies. The tier holding seventy per cent has a single enabling clause.
The incentive sits outside the Act. Budget 2026 extends to participating banks fiscal concessions similar to those granted for low-income housing, in exchange for rates below four per cent and reduced collateral requirements. That is a budget measure, not a statutory duty, and it binds nobody who declines to take it up.
How far are those terms from current practice?
Some distance, on the State’s own evidence.
The Small Business Bureau operates a Credit Guarantee Programme, guaranteeing loans up to G$30 million through two participating institutions, Republic Bank (Guyana) Limited and the Guyana Bank for Trade and Industry. The Bureau provides collateral coverage of up to 40 per cent for a first-time borrower and up to 70 per cent for a repeat borrower.
Read that mechanism carefully, because it is easily misread as collateral relief. It is not. The guarantee covers a share of the security. The borrower supplies the balance, which for a first-time applicant is the remaining 60 per cent. The Bureau’s own eligibility list requires the applicant to submit a valuation of the asset offered as collateral, alongside business registration, a tax identification number, GRA and NIS compliance and a CreditInfo report.
The consequence follows arithmetically. What an applicant can borrow is set by what an applicant already owns. A guarantee at 40 per cent lifts the multiple. It does not create the asset. An entrepreneur with no house and no land does not receive a smaller loan under this programme so much as a much smaller ceiling, whatever the merits of the business.
A guarantee changes the proportion of collateral required. It does not change the requirement to own something. The ceiling is set before the business plan is read.
Two further points follow. A programme built around a 40 to 70 per cent guarantee implies an underlying requirement substantial enough to need it. And participation is narrow rather than sector-wide, at two institutions.
Against that background, the co-financing tier asks lenders to extend credit on terms that, as at 31 July 2026, are not on general offer through the State’s existing programme. That may be exactly what the fiscal concessions are for. It is also the reason the terms should be written down. The Development Bank facility is designed to reach applicants who cannot satisfy a collateral test. If the second counter applies one, the borrower who most needs the G$10 million receives G$3 million, and the borrower who owns property receives the rest.
Where does the constitutional protection stop?
Article 149(1)(b) of the Constitution provides that no person shall be treated in a discriminatory manner by any person acting by virtue of any written law, or in the performance of the functions of any public office or public authority. Article 153 gives a direct right to apply to the High Court for redress, and the Court original jurisdiction to make such orders as it considers appropriate.
The Guyana Development Bank is created by statute and its officers will act by virtue of a written law. Whether a statutory corporation lending commercially is a public authority for these purposes has not been decided by any Guyanese court, and the question is open. The argument that it is appears strong.
The commercial banks at the second counter are in a different position. They act under private contract and general commercial law, not by virtue of a written law, and the constitutional provision does not obviously reach them.
Article 149(1)(b) reaches the State counter. It does not reach the private co-financing counter. The protection stops where the money starts.
This is not an argument that borrowers at the second counter are without recourse. Guyanese courts have recently found that a bank’s powers over its customers are not absolute and cannot be exercised in bad faith, and litigation over account terminations is live. The point is narrower and structural. Contract litigation asks whether a decision was made in bad faith. It does not ask what the criteria were.
What would close the gap?
The Act supplies the mechanism. Section 34(1)(b) empowers the Minister to make regulations on the terms and conditions applicable to loans provided by the bank, and section 34 as printed carries no subsection (2), so no resolution requirement attaches. Regulations bind where board-adopted policies do not. A credit policy can be revised without notice. A regulation cannot.
Three provisions would carry the second counter.
1. Write the co-financing terms into the participation agreements. Rate, collateral treatment, and the assessment basis. A borrower cleared at the first counter should know what the second one will apply.
2. Require reasons in writing for a co-financed decline. The State has approved the applicant. If the commercial tier declines, the scheme should record why, or nobody can tell whether the arrangement is working.
3. Publish participation and outcome data annually. Which institutions participate, how many co-financed applications were approved, and the decline reasons by category. Section 80(2) of the Fiscal Management and Accountability Act lets the Minister set the annual report format, so the route exists.
None requires amending the Act, and the commencement Order has not been signed. Every one costs less to build now than to retrofit after the first disputed decline.
Frequently Asked Questions
How much can a borrower access in total?
Up to G$3 million from the Guyana Development Bank at zero interest without collateral, plus up to G$7 million from participating commercial banks at preferential rates, for G$10 million.
What does the Act require of participating commercial banks?
Section 5(2)(b) confers a power to co-finance. It sets no amount, no rate and no obligation. The preferential terms sit in Budget 2026 as fiscal concessions rather than in the Act as duties.
Which banks participate in the co-financing tier?
The composition has not been published. Two banks participate in the separate Small Business Bureau Credit Guarantee Programme: Republic Bank (Guyana) Limited and the Guyana Bank for Trade and Industry.
Does the Small Business Bureau guarantee remove the need for collateral?
No. The Bureau provides collateral coverage of up to 40 per cent for a first-time borrower and up to 70 per cent for a repeat borrower. The borrower supplies the balance, and the published eligibility list requires a valuation of the asset offered as security. The amount available is therefore governed by the value of assets the applicant already owns.
Can the Minister set binding terms for the scheme?
Section 34(1)(b) empowers the Minister to make regulations on the terms and conditions applicable to loans provided by the bank. No regulations have been confirmed as made.
Disclosure
The author is founder and Managing Director of La Caribeña News, which publishes this article. He is Vice President and Public Relations Officer of the Essequibo Islands-West Demerara Chamber of Commerce and Industry, and a Director and Chair of the Services Sub-Sector at the Guyana Manufacturing and Services Association, whose membership includes commercial banks that may participate in the co-financing tier discussed here. The views are his alone. Neither organisation has considered or endorsed these recommendations, and this article does not represent the reporting position of the La Caribeña News newsroom.
This article analyses the text of the Guyana Development Bank Act 2026, Budget 2026, and published Small Business Bureau programme terms. It makes no allegation of discriminatory conduct against the Guyana Development Bank, which has no board, no chief executive and has made no lending decision. Participating commercial banks are not named because the composition of the co-financing panel has not been published. Clause references are taken from Bill No. 5 of 2026 as gazetted on 4 June 2026.