Some loans already approved under GBTI WOW facility

Several applicants for micro-business lending, under the Guyana Bank for Trading and Industry’s (GBTI) new Women of Worth (WOW) lending facility have had their loans approved, according to information disclosed to this newspaper by a senior bank official.

The WOW lending facility, made possible following the June 3 passage of legislation in the National Assembly allows single parents seeking to pursue modest business ventures designed to subsidize limited incomes to secure loans from the bank of between $100,000 and $250,000.

The Bank’s Head of Credit Shaleeza Shaw has told Stabroek Business that under the WOW lending arrangement applicants will not be required to satisfying conventional commercial bank lending criteria. “For these loans we take promissory notes from the applicants. No tangible security is used,” she said.

What has been described as a ‘collateral-less’ lending arrangement has been made possible through legislation exempting institutions approved by the Finance Minister as small-business lending entities from paying taxes on interests earned on such lending. GBTI is the first commercial bank to sign on to the scheme and Shaw told Stabroek Business that the waiver of taxes on interest secured under the amendment to the Act allows the bank to lend at a lower rate and translates into “greater benefits for the borrower.”

GBTI’s WOW lending facility is being facilitated through a joint public-private sector partnership arrangement under which the government is providing $500 million.

Persons seeking to access loans under the WOW facility must have had their names entered in the Ministry of Human Services’ Single Parent Registry and must be earning an income of no more than $40,000 per month.

Shaw has indicated that the bank has already received more than 200 applications from single parents in the depressed Linden community where the level of unemployment is reportedly among the highest in the country. Lindeners who have applied for funding under the WOW facility have reportedly indicated an interest in the food and clothing retail sector, poultry rearing, garment manufacturing, and cosmetology among others. Several persons who have applied to access WOW loans are currently in the process of registering with the Human Services Ministry’s Single Parents Registry in order to meet the criteria for accessing the loan.

Beneficiaries from GBTI’s WOW lending scheme, primarily single women between the ages of 18 and 60, will secure loans at an interest rate of 6%, repayable over two years. Stabroek Business has also learnt that GBTI is seeking to provide responses within one week of loan applications being made.

Shaw told Stabroek Business that the Bank’s WOW lending facility is one of a number of ways in which the new legislation can be applied in facilitating easy access to lending for small business ventures. She said that while the bank is currently focusing on getting the WOW scheme “on its feet” it is open to considering other ways of broadening the base of small business lending.