ACCESS to finance has long been a barrier for Guyanese businesses trying to establish themselves in the oil and gas sector. While local companies bring energy and ambition to the table, many are small and relatively new, lacking the financial strength of the multinational corporations and prime contractors they work for.

These suppliers are often required to deliver services or goods immediately, yet wait weeks or, in the past, months for payment. This mismatch creates cash flow constraints for Guyanese companies and makes it difficult for them to meet operational costs or take on new contracts.

Recognising this structural challenge, the Guyana Bank for Trade and Industry (GBTI) launched an Invoice Financing facility. It is a short-term working capital solution designed specifically to address the financial bottlenecks experienced by local suppliers in the oil and gas sector. Under the initiative, businesses can access up to 80% of the value of their validated invoices, effectively fast-tracking payments that would otherwise be delayed. This provides a boost for Guyanese companies working to stay competitive in a demanding and capital-intensive industry.

This is how it works. If Company A provides services to Company B—a major contractor, for example—it may not receive payment for several weeks. With invoice financing, Company A can submit its validated invoice to GBTI and receive a substantial portion of the funds upfront as a loan. When Company B eventually pays the invoice, the money goes to the bank, which deducts its loan cost (including interest) and remits the remaining balance to Company A. In essence, GBTI is offering a form of credit that uses invoices as collateral, bridging the financial gap for suppliers that need liquidity to stay operational.

This is especially important given the context of the oil sector’s payment dynamics. For a long time, payment terms for local suppliers stretched up to 90 days. This waiting period stifled many businesses. After sustained advocacy from the private sector, the Government of Guyana reduced this period to 45 days upon receipt of a correct invoice, enshrining this timeline in regulatory documents issued by the Local Content Secretariat. President Irfaan Ali acknowledged the improvement but maintained that 45 days is still too long and that the government was actively examining ways to shorten it further.

Invoice financing, therefore, becomes a practical workaround to reduce the real-time impact of delayed payments without having to overhaul the payment systems of large corporations overnight. In fact, ExxonMobil Guyana’s President, Alistair Routledge, has publicly acknowledged that the company had been exploring invoice factoring as one of the potential solutions for fast-tracking payments to local suppliers. NCB Capital Markets Ltd., a pan-Caribbean firm, has also floated similar financing models as viable options.

GBTI’s implementation of this solution signals responsiveness to the needs of the local business community and a willingness to innovate within the financial services sector, as Guyanese private sector representatives have long lamented the need for banks to step up. GBTI has said it understands the challenges faced by local suppliers and has spent the last few years working to find meaningful ways to ease access to working capital. By opening up invoice financing to registered suppliers with validated invoices from ExxonMobil Guyana and its prime contractors, the bank is providing a tangible path for these businesses to stay afloat, grow, and take on more complex assignments.

GBTI plans to expand the reach of this facility to other contractors in the sector and broaden the partner network. This kind of proactive behaviour by financial institutions can help level the playing field for Guyanese businesses, so they can take full advantage of the opportunities in the oil and gas industry.