The Egyptian Financial Regulatory Authority (FRA) has officially launched the electronic registry of movable assets that enables micro, small, and medium entrepreneurs to obtain additional financing for their projects by leveraging equipment and machines they own or what they intend to buy.
Mohamed Omran, FRA chairperson, said at a press conference that Egypt was the first Arab country to issue a law on movable guarantees in 2015, noting that the registry will be managed at the FRA’s headquarters in smart village.
According to Omran, the registry aims at activating financial leasing activity, facilitating the financing of SMEs, and reducing credit cost. He said that the authority is working to raise awareness of the benefits of the registry among SME owners, which account for 70% of the Egyptian market.
I-Score chairperson Mohamed Kafafy said that launching the registry will enable SME owners to benefit from the initiative launched by the Central Bank of Egypt (CBE) in 2016 worth EGP 200bn.
During the conference, Minister of Investment and International Cooperation Sahar Nasr said that the implementation of the registry and the recent package of financial legislation adopted by the government are helping to improve Egypt’s ranking in the World Bank’s Doing Business report.
She added that the registry complements state and CBE efforts towards financial inclusion, noting that the ministry asked the FRA to prepare a comprehensive strategy for the financial inclusion of all non-banking financial activities that will be completed soon.
Movable Securities Registry Law No 115 of 2015 and its bylaws was designed to overcome the legal difficulties faced by small and micro enterprises in accessing finance using movable assets as collateral for obtaining financing, since the general provisions of a custodial guarantee require the transfer of movable property from the debtor to the creditor or to another person accepted by the creditor.