IPED performed “satisfactorily” in 2016 – Chairman

Despite challenges

Despite challenges being faced by the local economy, the Institute of Private Enterprise Development (IPED) has managed to perform “satisfactorily” in 2016, by processing 4,459 loans compared to 4,086 in 2015 — an increase of 373 applications, which were valued at $2.3 billion.

During the 2016 Annual General Meeting (AGM), IPED Chairman Dr Yesu Persaud said the year was challenging for IPED and its beneficiaries, as they navigated through the adjustments being made to the economy. However, he noted that these changes are now better understood by entrepreneurs.
“IPED’s resilience through the period of difficulties mentioned before is a reflection of its quality leadership and workforce. Despite the challenges experienced in the year, the overall performance of IPED was satisfactory,” Chairman Yesu Persaud explained.
Dr Persaud revealed that IPED recorded $470.9 million net interest income in 2016, compared to $552 million in 2015. Among applications processed, 38 percent were for female beneficiaries, 13 percent were for persons below age 30, and 77 percent did not require real estate. Approximately 45 percent of applicants were within the agriculture sector, and 92 percent were from rural communities.
The AGM was also told that increased activities resulted in growth of the gross loans portfolio from $2.24 billion in 2015 to $2.47 billion in 2016, which marked a 10 percent overall growth.
IPED also experienced an improvement in its arrears, as portfolio at risk more than 30 days due was 23 percent at December 2016, compared to 26 percent at December 2015.
Despite this slight improvement, the IPED chairman pointed out, arrears remained high. Due to this, IPED was required to make what he described as an “impairment provision” of $100 million, or 17 percent of the portfolio at risk more than 30 days at December 31, 2016, compared to a provision of $89 million or 15 percent of portfolio at risk at December 31, 2015.
In addition to the financial support offered to micro and small businesses, the Entrepreneurial Development Centre, a department of IPED, provided training to 306 students for the Institute of Commercial Management (ICM) in 2016, and facilitated corporate training for 42 persons. The institute also provided training to 645 small and micro clients in several other areas.
Dr Persaud said IPED’s financial performance is a reflection of the decline in loan activities in 2015 and early 2016. The total interest income declined by $100 million, from $573 million in 2015 to reach $473 million in 2016; while investment and other income decreased by $13 million.
Total financial and operating expense was $454 million in 2016, compared to $463 million in 2015.
“We are proud of our history and contribution towards the development of Guyana through the continued support of more than 4,000 enterprises that sustain approximately 10,000 jobs on an annual basis. During our 31 years of existence, we have disbursed in excess of 104,000 loans to micro and small enterprises for a value of more than $32 billion,” the IPED chairman added.
IPED was established on October 2, 1985 as a company limited by guarantee, and a non-profit and tax exempt organisation formed to promote and encourage the development and growth of industry through the provision of business guidance, technical assistance, non-traditional credit facilities to small entrepreneurs or to groups; and generally to promote and encourage the development and growth of all other economic activities designed to improve the social and economic welfare of the people of Guyana.