Former Private Sector Commission (PSC) Chairman Komal Singh says small businesses could pool resources through consortiums to access financing beyond the Guyana Development Bank’s proposed GY$3 million (about US$14,400) microcredit limit.
Singh made the comments during an interview on the Guyana Dialogue podcast on August 20. He argued that bringing several businesses or individuals together could allow them to combine their financing and pursue larger projects.
“Government and the private sector has been talking a lot about consortiums and joint ventures, bringing more businesses and persons together. That is a concept that they are looking at here right now… So the intent here is to bring more than one individual together so they can bring those GY$3 million, maybe say 10 persons, for example, come together and they will raise GY$30 million with that grant money,” he explained.
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The Guyana Development Bank is intended to expand financing access for small and medium-sized enterprises (SMEs). The bank’s financing options include microcredit loans of up to GY$3 million for qualifying borrowers, along with secured and unsecured loans and other credit facilities.
However, he stressed that access to financing would not exempt businesses from meeting regulatory requirements.
“Accessing stuff right now in terms of permits and licenses is very easy. That doesn’t mean to say that they’re going to be compromising on the requirements… For example, if you’re going to open up a food business and you’re trying to apply for this loan, they will definitely be looking for all those requirements and make sure that you’re in compliance with those requirements,” he said.
Singh identified limited access to collateral as a longstanding barrier for smaller businesses seeking financing from commercial banks.
He noted that the government is also working with those institutions to provide an additional GY$10 million (about US$48,000) loan facility for small businesses and consortiums.
“Just in case the GY$3 million, if they come together, is not sufficient, they can now go to the commercial bank and access an additional GY$10 million loan. These GY$3 million, GY$10 million means a lot to these small businesses. When you look at the number of them around the country, they really add value to what’s happening in our economy,” Singh added.
The Guyana Development Bank Bill was passed by the National Assembly on July 27, before receiving presidential assent just days later.
Since the emergence of Guyana’s petroleum sector in 2019, the government has encouraged Guyanese businesses to form partnerships and consortiums to pool capital, resources, technical capacity and experience, enabling them to pursue larger oil and gas contracts that may be beyond the reach of individual companies.
