As a result of strategic planning and implementation by the PPP/C government, more Guyanese can now afford to take out loans and honour their repayments, Vice President Dr Bharrat Jagdeo has contended.
He was at the time rejecting the contents of an article in the local media which, he says, can undermine the confidence of the banking system in Guyana.
The article states that the New Building Society (NBS) made less money in 2023 when compared to previous years, despite disbursing in excess of $19 billion, its highest ever. The article credited this reduction in profits to the reduction of interest rates to as low as 3.5%, following a meeting with President Dr. Irfaan Ali.
But the Vice President asserted that the President did not direct the bank to reduce its interest rates but rather, “President Ali has been urging all of the institutions to ensure people can afford mortgages.”
Jagdeo also reminded that the NBS was set up to provide affordable mortgages to people and is not necessarily a profit-making venture.
He pointed out that in the 90s, the mortgage interest rate was ranging between 37% to 40%.
“It was impossible to borrow.”
But he outlined that the PPP government fixed the macro economy when it got into power and as a result, interest rates started to decline.
Because of the interventions, Dr Jagdeo highlighted, thousands of Guyanese began to own homes.
And now, similar strategic planning and implementation is being rolled out to ensure citizens continue to benefit, the Vice President posited.
“People can borrow at a cheaper rate in Guyana on these low-income mortgages at NBS than they can borrow in the United States of America now. When we were 40%, the US was 3% and 4% in the past. Now, you can borrow cheaper now in Guyana, than the United States of America, people should be proud of this,” Jagdeo expressed.
Moreover, he highlighted that by reducing the interest rates, borrowers are getting to save.
In fact, he said some 14,000 Guyanese through the NBS alone, saved some $800 million in reduced payment on their mortgages.
“That is a success story, that should be applauded,” Jagdeo asserted.
Meanwhile, the Vice President revealed that in 2020, mortgages for private dwelling stood at $82.7 billion and this year, it is $108.6 billion.
Additionally, he said in in 2019, non-performing loans in the banking system was 12.1% and this year, it is 2.7%, meaning more people are paying off their loans.
