Guyana is expected to allocate $200 million (about US$1 million) in seed capital next year to launch a new state-backed development bank. It is aimed at financing small and medium-scale enterprises (SMEs).
Vice President Bharrat Jagdeo had told reporters the government hopes to have the institution “fully established and functional” before the end of next year, with lending parameters finalized by then.
The bank will focus on entrepreneurs who lack collateral or access to commercial credit, particularly women and young people, he said. It will provide loans to help transform business ideas into functioning enterprises and allow existing ventures to expand.
“Many started a business, but they can’t either grow the business or get the idea translated into a business because of the lack of financing,” Jagdeo said. “We want to create an environment where young people, women and all Guyanese for that matter can make use of the opportunities in Guyana to create income for themselves and their families and to grow their wealth.”
The initiative comes as Guyana’s economy continues to post double-digit growth for multiple years, driven largely by booming offshore oil production led by ExxonMobil and its partners Chevron (which acquired Hess this year) and CNOOC. The government’s expanding revenues from profit oil sales and royalties have given it fiscal space to invest in long term development and economic diversification.
Rather than issuing broad cash handouts as some populist voices would have it, the administration has pursued what Jagdeo continues to describe as a strategic approach to social spending, designed to build capacity and create durable improvements in people’s lives. There are many examples of this. The government has eliminated tuition fees at the University of Guyana and all technical and vocational institutes, allowing thousands to pursue higher and skills-based education free of cost. In the housing sector, the state offers steel and cement subsidies and has driven down mortgage interest rates through policy coordination with local banks, making home ownership more attainable for low- and middle-income families. Through the Small Business Bureau, the government also provides credit guarantees and business incubators that help entrepreneurs access financing and scale their operations.
In health, the government offers annual dialysis subventions to ease the burden of treatment, while tax and tariff reliefs lower costs for households and businesses alike. The government has also introduced targeted grants, including assistance for medical tests, to promote better health outcomes, and increased old-age pensions to support senior citizens.
These measures aim to channel oil revenues into productive assets like education, housing, health, and enterprise, rather than transient and aimless consumption. The development bank, set to begin operations next year, is seen as the next step in this broader strategy: empowering Guyanese citizens to build generational wealth and grow the private sector.
The bank will complement wider financial sector reforms aimed at making credit more accessible. Jagdeo said the government plans to work with commercial banks to expand instruments such as trade-invoice discounting, project financing, and traditional commercial loans so that small businesses can better use the formal banking system.
For those who still fall outside those channels, the new bank will serve as a dedicated lender, providing financing under more flexible conditions to nurture private-sector growth.
“We believe a good starting point would be to ensure that these companies have access to capital,” Jagdeo said. “We’ll ensure that the formal banking system is reformed, and we’ll also, as promised, create this development bank for those who may not have access to commercial banks so that they too can realize the benefits and opportunities in our country.”
A concept paper outlining the bank’s operational framework is going through its second draft by now, based on Jagdeo’s comments. The proposal will progress in time for inclusion in the government’s 2026 budget, which will include the initial $200 million allocation.
Once established, the development bank is expected to become a key catalyst for broad economic growth, supporting small entrepreneurs as Guyana moves to transition from an oil-driven economy to one powered by a private sector that is even more diverse than it currently is.