Concerns Raised Over Guyana Development Bank's Capacity to Assess Agricultural Loans

According to Kaieteur News, economist and former Guyana Ambassador Dr. C. Kenrick Hunte has voiced several concerns regarding the operations of the Guyana Development Bank (GDB), questioning whether the institution possesses the requisite expertise, staffing, and accountability measures to adequately assess and manage the numerous loan applications it has received.

In a letter to the editor, Dr. Hunte stated that the bank's reported intake of between 15,000 and 20,000 applications, with nearly 30 percent originating from agriculture-related businesses, raises serious doubts about its capability to supervise and assess projects within that sector.

He pointed out that none of the members serving on the bank’s Board of Directors have experience in agriculture, and that no credit staff have been hired, which makes it difficult to comprehend how agricultural loan applications would be appropriately evaluated.

Dr. Hunte contended that the lack of agricultural knowledge was especially problematic given the concurrent decline in agricultural output and the rising demand for food. He added that the Ministry of Agriculture had not released a list of agricultural food prices since June 26, 2025.

Citing the Bank of Guyana’s Half-Year Report for 2026, Dr. Hunte suggested that the combination of decreasing agricultural production and increasing food demand necessitates an investigation into the impact on the cost of living and prices. He recommended that surveys be conducted in various markets to ascertain supply and demand conditions and determine the implications for consumers.

The economist also questioned who would be responsible for performing critical project appraisals and monitoring project implementation after loans were approved and disbursed. He explained that onsite project assessments prior to approval, along with supervising projects during implementation and production, are essential duties of credit personnel managing a bank’s loan portfolio.

Dr. Hunte questioned whether the Board of Directors would be responsible for these vital tasks, considering no credit staff have been hired, and called upon the board to publicly clarify these arrangements.

Furthermore, Dr. Hunte criticized the absence of a published credit policy, noting that the only conditions publicly mentioned so far were that loans would carry no interest and would not require collateral. It remained unclear what other criteria would guide application approvals, specifically whether the bank intended to cover the entire project cost or require applicants to contribute a portion of the investment from their own resources. The economist noted that commercial lending institutions typically fund only a fraction of a project’s total cost, expecting borrowers to provide their own funds unless sufficient collateral is available. He stated that the GDB needed to clarify if it would deviate from this standard practice and, if so, specify the financing requirements applicants would need to meet.

Another aspect Dr. Hunte described as particularly confusing was the reported plan to publicly identify loan applicants and permit members of the public to submit objections against them. He questioned the rationale for compromising the privacy typically maintained between a financial institution and its applicants, warning that this proposed arrangement could subject applicants to objections based on personal disputes or unrelated grievances. Using a hypothetical example of an individual objecting to an applicant due to a personal disagreement, Dr. Hunte questioned which entity within the bank would be tasked with investigating, verifying, and resolving such objections. He cautioned that the process could potentially harm individuals, arguing that financing decisions should be guided exclusively by the financial viability of projects and their contribution to economic development.

Dr. Hunte asserted that project financial viability and economic development objectives must be the sole criteria in GDB decision-making, and all other matters should be addressed by other public or private institutions.

Finally, Dr. Hunte raised questions regarding the bank’s financial reporting and auditing procedures, given that loans would be issued without collecting interest. He argued that the lack of interest income would mean the institution would lack this revenue stream, resulting in an unusual accounting structure that requires clear oversight. He stated that the operation would present a novel accounting experience and called for Parliament to mandate the Auditor General to establish the rules and guidelines governing the bank’s operations.

Dr. Hunte’s concerns surface amid increased attention on the Guyana Development Bank, which was established to offer financing support to entrepreneurs and businesses, with a specific focus on expanding economic opportunities. President Dr. Mohamed Irfaan Ali recently stated that the newly launched bank is attracting considerable interest from Guyanese, with an estimated 15,000 to 20,000 individuals already applying for support to pursue business and entrepreneurial ventures. The head-of-state shared this during an interview, noting that the strong response, combined with the ease of the application process, indicates an encouraging beginning for the national initiative, which commenced on October 5th. President Ali mentioned that he imagined launching such a large national program with approximately 15,000 to 20,000 applicants who applied without queues, from their homes, desks, or cricket fields.

Applications are currently being evaluated, with relevant teams assessing submissions and classifying applicants based on their intended investment sectors. He also noted the promising ideas emerging from the applications, including those submitted by young people. The bank is being designed to integrate digital efficiency with a physical presence nationwide, enabling applicants to access assistance without creating an extensive bureaucratic structure. President Ali urged citizens to obtain their digital identification cards and open bank accounts, describing these as vital parts of the country’s expanding digital framework. He stated that the future being built relies on these important national assets. Meanwhile, the bank’s board is reviewing candidates for the chief executive officer position, with the president indicating an appointment is anticipated soon.