Guyana is expected to amend its Financial Institutions Act (FIA) to ease access to capital, a major private sector concern.
President Irfaan Ali announced the proposed changes at a June 20 press conference and emphasized that the amendments will give banks “more independence” to boost Guyana’s investment climate.
The head of state said the amendments aim to attract international institutions; several requests have already been received. They will also enhance compliance with international banking standards and the Basel Core Principles on Banking Supervision.
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“These amendments will take us to the top tier beyond any other jurisdiction in this region in relation to the banking sector,” President Ali stated.
The changes will update the legal framework, rules, regulations, and principles governing the banking sector. They will improve mechanisms for asset transfer during business transactions. Foreign financial companies will be allowed to establish representative offices with bank approval. Although these offices cannot conduct banking or financial business, they can facilitate foreign direct investment by linking capital to investment opportunities.
The amendments will also provide regulatory oversight for licensed financial institutions to set fair service fees, promoting financial inclusion and market fairness. Consultation requirements with the Minister of Finance will be removed, enabling more effective supervision and cooperation among authorities.
Sanctions for non-compliance by financial institutions will be increased, encouraging adherence to statutory requirements and supervisory directives. The changes aim to strengthen legal protection for government officers and bank employees in their duties, benefiting Guyana by modernizing its financial and banking system as the economy grows.
“The economy is growing, we have sophisticated financial instruments and institutions to manage,” President Ali outlined.
In April, President Ali had called for more investment bankers and a transformative approach in banking to keep pace with the country’s burgeoning scale of operations.
His comments strike at the heart of a longstanding issue of access to finance (the lack thereof) for Guyanese businesses looking to capitalize on the country’s growth trajectory. Private sector organizations continue to advocate for financial institutions to develop creative mechanisms to help businesses grow.
