Govt integrates moveable property registry to allow businesses use vehicles as collaterals

The movable property registry and the motor registration systems have been integrated to facilitate easier access to asset-backed credit by consumers, especially the Micro, Small to Medium Enterprises (MSMES).

This integration is expected to play a critical role in ensuring confidence in securing of motor vehicles and other machinery registered with Road Transport and Safety Agency (RTSA) as security for borrowing in the market.

This initiative is under the enactment of the movable property (security interest) act of 2016 and the establishment of the Moveable Property Registry System (MPRS), which is hosted and managed by Patents and Companies Registration Agency (PACRA).

Bank of Zambia (BoZ) Deputy Governor-Operations, Francis Chipimo, said the overall objective of the act was to make it attractive for lenders to accept movable property as collateral and diversify the nature of movable assets used as collateral.

Chipimo said during the integration of the systems in Lusaka recently that in essence, the act seeks to make movable property a reliable and acceptable form of collateral.

He said the integration of the MPRS with the road transport registration system was therefore one of the key achievements attained in improving credit infrastructure in Zambia.

“It is gratifying to see that government efforts of improving access to credit for MSMES in Zambia has finally culminated in this innovation of integrating the MPRS and the motor vehicle registration system,” Chipimo said.

He said this in a speech read on his behalf by BoZ Director Non-Bank Financial Institutions Supervision, Freda Tamba.

At the same function, IFC country and World Bank Group representative (Zambia) Anddie Liempe said: “This integration will play a critical role in ensuring confidence in the securing of motor vehicles and other machinery registered with RATSA as security for the borrowing in the market.

“This is a game changer in as far as security registrations of these asset types is concerned. This will result in increased borrowing especially for the MSME sector. This process will protect lenders and will help financial institutions manage their risks better.”

PACRA acting Registrar and Chief Executive Officer, Wilson Banda, said this would help to increase access to credit by small scale businesses.

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