Demerara Banks gets US$7M line of credit from IDB for small businesses

Oct 31, 2020 News

(L-R) IDB country representative Sophie Makonnen with Chairman and founder of DBL, Dr. Yesu Persaud; Chief Executive Officer of DBL, Pravinchandra Dave along with a local Investment Officer.

Kaieteur News – Demerara Bank Limited (DBL) has received a US$7 million line of credit from the Inter-American Development Bank (IDB) Trade Finance Facilitation Program (TFFP) to fund small and medium scale business lending services to Guyana’s blooming oil and gas sector.
The funds are made available from IDB Invest, a member of the IDB Group serving as a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector.
Chief Executive Officer (CEO) of DBL, Pravichandra Dave at the simple signing ceremony yesterday explained that the line of credit will be extended to those businesses that have no collateral.
“The Trade Facility will be extended to small scale entrepreneurs, small businesses, for the pre-shipment facilities, pre-shipment and post-shipment finance. There are a lot of suppliers to the oil and gas companies who are not able to provide the necessary collateral to the bank and what we can do now is create a charge over the receivables and we can provide the facility to them,” he told the media.
Additionally, Dave said that DBL aims to provide similar services to small businesses in the Forestry, Mining and Agriculture sectors.
Given the current context of high volatility in international markets and macroeconomic pressures from the COVID-19 health crisis, this line will help support existing industries and new and emerging businesses in sustaining productivity and job creation.
Not only that, the line will also allow increase foreign trade products to its SME clients, adjusting its menu of products to the current context of client demands.
Meanwhile, IDB Group Country Representative, Sophie Makonnen, pointed to the need for private sector development as they play a key role in economic growth.
“We want to support the private sector through this arm, which we call IDB Invest,” Makonnen said, adding “We understand that the private sector plays a pivotal role in development. A strong and healthy private sector is what we see as the engine of growth. It is pivotal for the country to generate investment through employment.”
Echoing similar sentiments was IDB Group CEO, James Scriven who joined via the Zoom platform. Scriven added that the IDB Group is willing and ready to assist any banking facility that is eager to provide financial services to the local productive sector.
He said, “This is a starting point for us to prepare the institution to do so much more. We feel that the consequences of the global pandemic is going to have a disproportionate impact on many people and all our economies and Guyana is not going be an exception to that as well as many other economies so we are extremely pleased to be signing this today.”
IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region.
With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

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