Over 1,000 financial institutions registered under movable property act by PACRA

The Patents and Companies Registration Agency (PACRA) has disclosed that over 1,000 financial institutions have been registered this year under the movable property (security interest) Act No 3of 2016.

Speaking during a workshop held at Sherbourne Guest Lodge in Kitwe today to sensitize financial lending institutions on the benefits of the act, PACRA Assistant Registrar Commercial unit Christopher Mapani said the act seeks to promote the use of movable property as collateral in financial transactions thereby easing access to credit particularly by the small and medium enterprises.

Mr Mapani said from the time the act was enacted into law on 6th April 2017, PACRA has registered over 1,000 financial lending institutions which most of them operate as macro institutions.

He said the law provides for the establishment of collateral registry for movable property housed at PACRA and other interventions aimed at giving lenders the assurance required to accept personal or movable property as collateral.

Mr Mapanis added that PACRA in collaboration with the Bank of Zambia is engaging financial institutions across the country through workshops to promote sensitization of the act and ensure that the act is fully implemented.

‘’We are here to educate people on the collateral registry. This is a registry that is been established under the movable property security interest act which was enacted in April last year. The act seeks to make movable properties attractive to lenders. This comes after some studies where done to see if the act is workable,’’ Mr Mapani said.

And Kitwe District Commissioner Binwell Mpundu observed that the law will make access to credit by SMEs easier.

Mr Mpundu said the government is aware of the many challenges SMEs face when accessing credit hence the enactment of the law.

Speaking earlier Bank of Zambia Assistant Director Regulatory Policy and Licensing Joseph Mphande said the country has made significant headway in the development of the legal framework for the credit infrastructure.

Mr Mphande said very few micro and medium enterprises have access to credit because most banks and financial institutions prefer to lend when security is provided in form of land or buildings.