IN keeping with government’s commitment to revolutionising how credit is accessed in Guyana, Minister of Tourism, Industry and Commerce, Oneidge Walrond, on Wednesday presented the Security Interests in Movable Property Bill 2024 in the National Assembly.

This legislation introduces a framework to enable individuals and businesses to leverage movable assets—such as machinery, vehicles, inventory, accounts receivable, and intellectual property—as collateral for loans.

The bill is a response to longstanding concerns about the challenges Guyanese face in obtaining credit due to limited access to traditional forms of collateral, such as real estate.

For small businesses and startups, which often lack the financial heft to own fixed assets, this legislation could be a game changer.

WHAT THE BILL PROPOSES?
At its core, the bill establishes a modern, streamlined system to secure and enforce loans against movable property.

It introduces a national registry to record security interests, ensuring transparency and reducing risks for creditors. This digital database will allow banks and lenders to quickly verify if a movable asset has already been pledged as collateral.

The bill also provides a uniform legal framework for creating, registering, and enforcing security interests. It simplifies the process for both lenders and borrowers, making credit more accessible while mitigating potential disputes over ownership or claims on assets.
The ripple effects of this legislation could be significant. Easier access to credit can stimulate entrepreneurship, innovation, and economic diversification.

Micro, small, and medium enterprises (MSMEs)—the backbone of Guyana’s economy—stand to benefit the most. Entrepreneurs will be able to invest in equipment, expand operations, and improve productivity without the burden of securing immovable assets.

This comes at a crucial time for Guyana, as the nation seeks to channel its oil wealth into long-term sustainable development. By encouraging local business growth, the bill aligns with the government’s broader agenda to create an inclusive and diversified economy.

Despite its promise, the bill has sparked debates. Some critics have raised concerns about potential risks to borrowers, such as repossession in cases of default. Others worry about the system’s implementation and whether lenders will be willing to accept movable assets as sufficient security.

However, the bill will have robust safeguards in place to safe guard the public. The registry system is set to minimize fraudulent claims and disputes, while public awareness campaigns will educate borrowers on their rights and obligations under the new framework.

The concept of movable property as collateral is not new. Similar systems have been successfully implemented in countries like Jamaica, Kenya, and Canada, leading to increased credit flow and economic growth. Guyana’s adoption of this framework positions it as a forward-thinking nation, ready to embrace innovative financial tools.

WHAT’S NEXT?
The bill will now proceed to its second reading, where it will be debated by members of the National Assembly.

If deemed necessary, it could be referred to a Select Committee for detailed review before the final reading and vote. Once approved, the bill requires presidential assent to become law.

When enacted, the Ministry of Tourism, Industry and Commerce plans to roll out the registry and begin stakeholder consultations to ensure a smooth transition.

For small business owners and aspiring entrepreneurs, this legislation could mark the beginning of a new era—one where their ideas and assets, no matter how modest, have the power to unlock their full potential.

The People’s Progressive Party Civic-led government has been actively enhancing access to loans for small businesses through several initiatives aimed at fostering entrepreneurship and economic growth.

This includes a loan agreement worth $100 million with the Small Business Development Finance Trust (SBDF).

Last year it was reported that the SBDF disbursed over 6,800 loans valued at approximately $4.5 billion since its inception, demonstrating its commitment to supporting micro and small enterprises.

In the 2024 budget, $450 million was allocated for the replenishment of the Small Business Development Fund and $331 million was allocated for the Small Business Bureau. The disbursement of 100 loans and 1,362 grants is the target for 2024.