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Govt. to control Development Bank with no oversight from Opposition, transparency bodies or civil society
…all Directors, Chairperson and Deputy Chair to be appointed by Finance Minister
…some loans to attract interest, collateral
…no penalty for corrupt banking officials seeking kickbacks
…loophole in Bill allows foreign nationals to cash in
(Kaieteur News) – Proposed legislation to govern the Guyana Development Bank was on Friday afternoon tabled in the National Assembly by an energetic Finance Minister, Dr. Ashni Kumar Singh.
News of the financial institution sparked excitement among Guyanese as the Government of Guyana (GoG) marketed the facility as one that would offer zero interest to Guyanese on loans up to $3 million with no collateral required.
Finance Minister, Dr. Ashni Singh
The legal framework to govern the bank however reveals a different picture than that promised by government.
According to Section 5 (2) of the Bill, “Subject to the other provisions of this Act, the Bank may- (a) assist small and medium-sized enterprises in establishing, carrying on or expanding their operations by providing loans with or without collateral and with or without charging interest.”
The proposed law does not clearly outline what specific projects will require collateral or attract interest and at what specific rates.
Govt. control of financial resources
Perhaps more disturbing is the fact that $40B or approximately US$200M initially- as the sum can be revised in Parliament- will be dispersed at the sole discretion of government appointees. The Bill makes no provision for any nominees to be submitted by the Opposition, civil society or any transparency bodies, raising concerns over the direct control of billions by the administration and the likelihood of selection based on “political alliance”.
The involvement or appointment of individuals stemming from these sections of society will undoubtedly provide an added layer of scrutiny with more eyes overseeing the rollout of billions of state resources.
According to the proposed legislation, the bank will be governed by a Board of Directors which shall consist of not less than five or more than nine directors which are to be appointed by the Minister of Finance.
The Minister shall also appoint the chairperson and deputy chairperson along with other directors based on “qualifications and experience in finance, economics, banking and law.”
The Guyana Development Bank Bill was tabled in the National Assembly on June 5, 2026.
Remuneration and allowances are also to be determined by the finance minister for the directors of the bank.
A director may serve for three years and can be reappointed. The Board shall also appoint a Chief Executive Officer and establish one or more committees to “deal with any matter within the competence of the Board.”
The bank will be financed through allocations made by the National Assembly and revenue generated from interest. The loan ceiling has been set at $3M and can be revised through the Parliamentary process.
The Bill makes no reference to how persons interested in co-investing in business ideas will be treated.
Vague criteria and eligibility
Moreover, the proposed law provides vague details on criteria and eligibility for persons interested in financing. In fact, it does not single out Guyanese as the sole or primary beneficiaries. This loophole means that citizens of other countries can possibly apply for a loan under the Guyana Development Bank to fund their small or medium-scale business.
Part V, which sets out the criteria for financing ambiguously states at Section 23: “A small and medium-sized enterprise applying for financing shall provide such information, documents and statutory declarations as may be prescribed or required by the Bank.”
Meanwhile, Section 25 explains that the bank shall “adopt written credit policies” to address (a) eligibility criteria: (b) risk assessment; (c) approval thresholds and; (d) monitoring and recovery.”
Lack of strict penalties
Notably, the Bill lacks strict penalties for the gross mismanagement of funds entrusted to the individuals appointed by the finance minister.
Five offences have been singled out under the proposed Act. These include “(a) provides false or misleading information to the Bank; (b) obstructs or hinders the Bank in the exercise of its functions; (c) falsifies, conceals, alters or destroys any record or document relating to the affairs of the Bank; (d) improperly discloses confidential information obtained under this Act; or (e) willfully misapplies or misuses the funds, property or assets of the Bank.”
While the fifth offence under the Act speaks to misapplication or misuse of the funds, it does not capture any unauthorised withdrawals by those entrusted with managing the resources. It merely suggests that persons who have obtained a loan must use the funds for the purposes intended.
Additionally, no penalties have been identified for corrupt banking officials who may seek special and secretive payments or favours to grant loans to the public.
Nonetheless, the Bill states that if a director, manager, secretary or similar officer is found to be in “connivance” or gave consent to any offence listed above, that person also commits an offence and will be liable on summary conviction to a fine of not less than $5M and not more than $10M.
Similarly, any person or corporate body that commits an offence will face these penalties.
Meanwhile, the Bill at Section Six highlights prohibited activities of the Bank which include: (a) accepting deposits from the general public; (b) engaging in speculative trading and (c) carrying out business inconsistent with the development mandate.
The Guyana Development Bank will be audited annually by the Auditor General, with its Annual Report and Audited Financial Statements to be tabled in the National Assembly.
The proposed framework to govern the Guyana Development Bank is expected to be debated in the National Assembly before it is officially approved and assented to by President Irfaan Ali.
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Loans without collateral ?
This would be a free for all who wants free cash.
I could use a few $3Million since one such loan would be inadequate.
What date is the Guy-Line forming ?