ECONOMIC ANALYSIS · DEVELOPMENT FINANCE · GOVERNANCE
Georgetown — April 23, 2026
Attorney General Anil Nandlall confirmed that the legislation establishing the Guyana Development Bank is in its final stages and that the draft bill is already with the President for technical review. After months of delay, manifesto commitment, and a first-quarter launch target that came and went without one, the bank is approaching legislative form. That is progress. It is also the moment when design matters most.
The problem the bank is meant to solve is real and well-documented. Commercial banks in Guyana charge between eight and fourteen per cent on business loans and require property collateral on terms that effectively exclude most of the entrepreneurial population the oil economy is nominally supposed to uplift. The Small Business Bureau, which has been doing a version of this work since 2013, trained 3,234 entrepreneurs and facilitated G$280 million in loans in 2025 alone, and its pipeline remains longer than its disbursement capacity. The issue, however, is not simply that credit is expensive. It is that the pricing of risk reflects the absence of institutions capable of absorbing risk at scale. A development bank is, at bottom, such an institution. Its existence is not a concession to populism; it is an admission that the commercial banking system cannot, on its own, convert the country’s demographic and entrepreneurial potential into productive enterprise.
A bank that disburses money without building the capacity of its borrowers produces defaults. A training programme that builds capacity without providing capital produces frustration.
— Terrence R. Blackman
Jenelle Grant’s essay in this Journal on Tuesday named the cost of the resulting informality with unusual precision. A business that treats bookkeeping as a year-end task is, in her phrase, invisible to credit. It cannot document itself into the financial system even when the financial system is willing to meet it. The Development Bank’s design acknowledges this. It does not simply open a window and wait for applicants. It bundles capital with training — proposal drafting, financial literacy, project planning, marketing, budgeting, management. That pairing is the right theory of change. The instruments that work in peer economies understood this pairing from the outset. Jamaica’s Development Bank has endured for twenty-five years because its governance was insulated, at founding, from ministerial override. Singapore’s development finance institutions have survived because performance metrics were written into their statutes, not bolted on later. Botswana’s built patience into its mandate, allowing early default rates to season without ministerial panic. The AG’s team has studied these models. The question is which of their lessons the bill before the President will actually encode.
The Two-Tier Financing Structure
The two-tier structure is similarly well-conceived. A zero-interest, zero-collateral envelope of up to G$3 million issued directly from the Development Bank, with an additional G$7 million available through commercial banks at preferential rates below four per cent and with reduced collateral, acknowledges that the bank cannot and should not try to do everything alone. It leverages the commercial banking infrastructure rather than bypassing it. And the stated prioritisation of youth, women, and persons living with disabilities is defensible on both equity and economic grounds. The diagnosis, in other words, is correct. The design intent is correct. The instincts behind this initiative are the right instincts.
The instruments that survive, however, are not the ones with the best diagnosis. They are the ones with the best governance. And it is here — in the unglamorous clauses of the bill now sitting with the President — that the bank’s long-term viability will be decided. Four variables deserve sustained public attention, none of which has so far received it.
The Four Governance Variables
Who sits on the credit committee? How is political override prevented when an election approaches? A development bank whose credit decisions are made by officers answerable to a political principal will not survive the first electoral cycle in which the loan book becomes a patronage instrument.
Is the GDB replacing the SBB, supplementing it, or competing with it? The SBB has been running a credit guarantee programme with Republic Bank and GBTI since 2014, offering 40–70% collateral coverage. If two agencies offer overlapping instruments with different terms, beneficiaries will learn to arbitrage between them, and neither institution will produce clean data on its own performance.
A development bank without annual public reporting on disaggregated outcomes — default rates by sector, gender, and region; employment and revenue outcomes tracked over multi-year horizons — is an institution that cannot be meaningfully evaluated. Without that discipline, no one will be able to say in three years whether the bank is working.
The bank will lend only to registered businesses with TIN and NIS compliance. This is not a side effect of the design; it is one of its most important features. The Development Bank is, among its other functions, an instrument of formalisation — pulling informal operators into the visible economy where they become taxable, auditable, and legible to credit.
The first is governance architecture. Who sits on the credit committee? By what mechanism are its members appointed, and by what mechanism can they be removed? How is political override prevented when an election approaches? A development bank whose credit decisions are made by officers answerable to a political principal will not survive the first electoral cycle in which the loan book becomes a patronage instrument. The legislation should specify the composition of the credit committee, the terms of its members, the grounds for removal, and the mechanism by which decisions are appealed. The AG’s team has studied the models. The question is whether the bill encodes the lesson.
The second variable is the relationship between the new bank and the existing Small Business Bureau. The SBB has been running a credit guarantee programme with Republic Bank and GBTI since 2014, offering forty per cent collateral coverage to first-time borrowers and up to seventy per cent to repeat borrowers on loans up to G$30 million. Its training programmes are substantial and its regional infrastructure is already in place. The Development Bank is not being built on empty ground. Is it replacing the SBB? Supplementing it? Competing with it for the same applicants under different rules? The legislation should be explicit. If two agencies offer overlapping instruments with different terms, beneficiaries will learn to arbitrage between them, and neither institution will produce clean data on its own performance. This is how parallel institutions produce noise instead of knowledge — each reporting its own numbers on its own cohort, neither capable of telling the country how the system as a whole is actually working.
The third variable is data discipline. A development bank without annual public reporting on disaggregated outcomes — loan-to-disbursement ratios, default rates by sector, gender, and region, training-completion metrics, employment and revenue outcomes for funded businesses tracked over multi-year horizons — is an institution that cannot be meaningfully evaluated. The SBB publishes such figures. The Development Bank, operating with twenty times the capital, should be held to a higher standard, not a lower one. The legislation should require public reporting in a specified form and at specified intervals, with the reports laid on the table of the National Assembly. Without that discipline, no one — not the opposition, not the press, not this Journal, not the diaspora — will be able to say in three years whether the bank is working. That absence is not a matter of transparency alone. It is an epistemic failure: a country cannot learn what it cannot see.
The fourth variable is the compliance prerequisite — and this is where the essay most directly meets Grant’s piece of Tuesday. The bank will lend only to registered businesses with Tax Identification Numbers and National Insurance Scheme compliance. It must. But this is not a side effect of the design; it is one of the design’s most important features. The Development Bank is, among its other functions, an instrument of formalisation. It will pull a substantial cohort of currently informal operators into the visible economy, where they become taxable, auditable, and — crucially — legible to credit in the years ahead. That is a considerable benefit. It is also, inescapably, an extension of state legibility over economic life. The bank’s window into its applicants becomes, by necessity, the state’s window into them as well. That tradeoff is not an argument against the bank; it is an argument for designing both sides of it honestly, and for building into the institution clear limits on how data collected for credit purposes may be used for other purposes. The informal-economy reflex, in Grant’s phrase, is no longer safe, and the Development Bank is one of the instruments that will make it most unsafe. Businesses that want to access this capital will need to get their registration, compliance, and accounting in order before the application window opens. The Journal’s readers — and particularly those running or advising small businesses — should be treating the next several months as the preparation period, not the waiting period.
A country does not get many chances to build a development bank in the opening years of an oil boom. The design choices made in the next sitting of the National Assembly will be with us for a generation.
— Terrence R. Blackman
The bill is with the President. When it reaches Parliament, the temptation on all sides will be to debate the existence of the bank rather than its architecture. The opposition will be tempted to frame it as a political instrument in the run-up to the next cycle; the government benches will be tempted to frame any criticism as obstruction. Both framings will miss the question that actually matters. The question is not whether a Guyanese development bank should exist. That question is settled and should be. The question is whether the institution being established will be built with the governance clauses, the reporting requirements, the interagency delineations, and the credit-committee independence needed to survive the political cycles that will test it. A country does not get many chances to build a development bank in the opening years of an oil boom. The design choices made in the next sitting of the National Assembly will be with us for a generation. These are not technical details. They are the difference between an institution that compounds national capacity and one that quietly redistributes it. In an oil economy, that difference is not temporary. It is structural, and it is generational.
Be well.
This essay is published with the support of MCCGUSA and the Guyana Business Journal’s commitment to independent economic analysis.
Terrence R. Blackman is Founder and Publisher of the Guyana Business Journal. He is Professor and Chair of the Department of Mathematics at Medgar Evers College, City University of New York.
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