The agreement, being part of a US$1.25million support package from the Swiss Government to the International Finance Corporation (IFC), is to enhance smooth implementation of the Secured Transactions Project with the BoG to ease access to finance for local small businesses.
Government passed the borrowers and lenders Act 773 in 2008 to establish a collateral registry which is currently being housed at the Bank of Ghana.
The collateral registry will hold information about creditors’ collateral which they have provided as security for loans. This information will be accessible to other lenders.
Andrea Semadeni, Ambassador, Embassy of Switzerland to Ghana Togo and Benin, signing on behalf of the Swiss Government in Accra said: “The support of the Swiss Government, being facilitated by IFC, will redesign the current registry system to a modern web-based Secure Transactions Registry System and also transfer existing data in the current collateral registry system to the new web-based registry.
“This will help facilitate decisions of providing access for SMEs with a clearer set of data, which will help boost the growth of SMEs.”
Mr. Michael Oppong Adusah, Registrar, Collateral Registry, BoG, indicated that the funding will quick-start implementation of the registry to ensure speedy online business registration of SMEs in the country.
“Registry staff will be given software training to ensure a well-functioning, modern collateral registry.
“The country’s credit market is highly competitive, but most banks lend to enterprises that are able to offer immovable assets as collateral. Yet even with collateral, banks are unwilling to provide lending due to the risk that collateral may have been used in multiple-borrowing,” Mr. Adusah remarked.
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US$350,000 Facility To Develop SMEs Collateral Registry