Mozambique goes live with Bsystems Collateral Registry System
Mozambique, one of Africa’s fastest growing economies has gone live with Bsystems Collateral Registry System as a move to improve ease of doing business in the country, through the disclosure of information by borrowers/debtors and help increase access to finance or credit for small and medium businesses.
The Movable Property Collateral Registry (MPCR) is established pursuant to the provisions of article 52 of Law nr. 19/2018, dated 28 December.
This Law promotes access to credit through the institutionalization of a system that diversifies and strengthens legal security in the constitution of collateral from movable property and the timely provision of information on such collateral.
The Movable Property Collateral Registry is managed and administered by the Ministry of Justice.
The collateral registry, launched this month, will enable Mozambicans to use movable assets to get a loan. Such assets include motor vehicles, livestock, crops, maize mill, equipment, or accounts receivable.
As in many other countries, financial institutions in Mozambique traditionally require fixed assets such as land or buildings as collateral for loans.
The Registry is an online public database that allows financial institutions to register security interests in movable property and mitigate the risk of customers. With the introduction of the collateral registry, banks should be able to diversify their credit portfolio from mostly corporates to include small and medium enterprises.
Being a web-based system, offers remote access even beyond normal business hours without visiting the registry office. With this system in place, officials of the registry are free from operations that involve paper work, manual reviews and searches. Storage costs is also greatly reduced.
The online Registry facilitates the electronic registration of information on movable collaterals submitted through registration forms; it entails rules for creating security interest, effective procedures and protection in case of default, including enforcement and repossession.
The system provides an avenue for lending institutions and the general public to conduct searches on registered notices and collaterals as well as other ancillary functions.
The Bsystems Collateral Registry System software solution has been adopted by Central Banks and Registrar General’s Department of Eight other African countries including Ghana, Nigeria, Liberia, Malawi, Zambia, Sierra Leone, Uganda, and Ethiopia with an ongoing project for similar implementation in Zimbabwe.
The implementation of the collateral registry software solution in Mozambique, brings to Nine (9) the number of African countries that are currently enjoying the benefits of Bsystems Collateral Registry System.
The project was supported by the International Finance Corporation (IFC), a member of the World Bank Group can be accessed here crgm.gov.mz