Poorly managed cash grants could fuel inflation – Economist

As discussions continue around cash grants and direct transfers, Guyanese economist Richard Rambarran warns that while such payouts can help vulnerable groups and stimulate spending, they can also drive inflation if they are poorly designed or become predictable. Rambarran said cash transfers do have economic value, particularly when targeted at low-income and vulnerable groups, but cautioned that broad or recurring payouts can create market expectations, encourage price increases and add pressure to the cost of living.
Addressing the economic implications of direct cash support during an interview he posted on one of his social media pages, Rambarran said the effectiveness of such measures depends heavily on how they are structured, who receives them, and whether they are temporary relief or become an ongoing economic expectation. “Cash grants are useful. Cash grants have their merit,” he said, adding that their long-term value hinges on careful management and sound policy design. “And the literature in development economics is not resoundingly clear as yet as to the true long-term impact of cash grants,” Rambarran noted.
Despite these reservations, Rambarran said cash transfers can serve a legitimate role in public policy, especially when aimed at those least financially secure or who stand to gain the most from temporary state support.
“What I can say is that once cash grants are targeted to vulnerable groups, children who are investing in themselves and, by extension, investing in the country’s future, groups not traditionally earning as much, the literature has demonstrated there is a strong impetus to support economic growth,” he said.
He stressed that the debate should not be about whether cash grants exist, but whether they are framed and used in ways that support households without destabilising prices. Rambarran argued that occasional, well-timed grants can also provide a short-term boost to consumer activity and help circulate money in the economy. “Broad cash grants from time to time, when unannounced or not anticipatory, do not create a degree of expectation within the economy,” he said.
During the previous national cash grant initiative in late 2024 into 2025, more than $60 billion of disposable income was transferred into the pockets of over 600,000 Guyanese. Another $60 billion is expected to be transferred in this second round of distribution. These two cash distribution exercises follow the initial National Cash Grant of $25,000 per household, paid in 2020 after the People’s Progressive Party/Civic (PPP/C) returned to office amid the COVID-19 pandemic.

Online registration
This year, however, citizens 18 years and older are required to apply online for the grant. To date, over 85,000 persons who successfully registered and were verified on the Government’s online portal have received their grants via direct deposits into their bank accounts. Phase One of the programme saw 48,858 Central Government employees, including public servants, teachers and members of the disciplined services receive their grants on March 19, totaling $4.9 billion.
Following this, Phase Two opened an online portal on March 26 for citizens to self-register. The first batch of citizens, numbering 13,168, received their grants on March 30, bringing the total number of recipients to 62,026 and injecting $6.2 billion into the local economy. With the addition of the second batch on April 1, the total number of beneficiaries, including Central Government employees, rises to 85,842, representing over $8.5 billion in funds disbursed nationwide. As of today, 63,113 individuals have completed self-registration, while another 25,879 are at various stages of the process. All eligible citizens are encouraged to continue registering through the portal at https://cashgrant.gov.gy to access their grants.
As part of the registration process, eligible Guyanese, that is, citizens aged 18 years and older as of February 28, 2026, will have to establish an account on the portal with their basic personal information (name, address, and telephone number) and provide a valid national identification (ID) card or Guyana passport.
Applicants will also have to undergo a facial recognition test or a liveness test, as well as provide their bank account information. While there has been some criticism about this method of distributing the cash grant, the Finance Minister said during a previous update that there has been a tremendous response, with numerous persons taking advantage of this self-registration tool.