 |
Andrea Iffland, Regional Director of ADB's Pacific Liaison and Coordination Office, speaks at the launch of PNG's secured transactions registry at the Crowne Plaza Hotel in Port Moresby. |
PORT MORESBY, PAPUA NEW GUINEA – An online registry launched today will allow Papua New Guinea (PNG) lenders to readily accept moveable property such as vehicles, machinery, or stock as collateral for loans, making it easier for many businesses to access credit.
“Access to credit allows new businesses to be formed and existing businesses to innovate and expand, spurring the creation of jobs and wealth,” said Andrea Iffland, Regional Director of ADB’s Pacific Liaison and Coordination Office in Sydney. “The registry is the final step in the creation of a new legal framework designed to promote commerce within PNG by simplifying and safeguarding lending processes.”
The business registry was launched by the Minister for Treasury Patrick Pruaitch at a breakfast hosted by the PNG Chamber of Commerce and Industry at Crown Plaza Hotel.
 |
Rosanda Kora, PSDI's PNG Country Coordinator, demonstrates the functions of the new registry. |
The framework, Iffland added, will advance PNG’s economic development by allowing business people and entrepreneurs to unlock the value of ‘dead capital’ and use it in ways that will help grow the private sector. It is underpinned by the Personal Property and Security Act (PPSA), which was passed by the PNG Parliament in 2011. This important reform was led by the PNG Department of Treasury with support from PSDI.
Through the online registry, lenders can secure their claim on assets borrowers have pleaded as collateral and verify the same asset has not been pledged elsewhere. Moreover, under the new framework lenders will often not require the services of a lawyer and a court order to repossess a pledged asset in the event of non-repayment.
“The PPSA must not be seen as a concept this government is testing out,” said Minister Pruaitch. “It is a practical reality that has been implemented, and its benefits felt, by economies across the globe, including by neighbouring Asian and Pacific island countries.”
 |
PNG Minister for Treasury Patrick Pruaitch applauds after activating the Personal Property Security registry at its launch in Port Moresby. |
PNG is the eighth country PSDI has helped to implement secured transactions reform, with support in three other countries ongoing.
The convenience and accessibility of the registry will also encourage non-bank suppliers, such as wholesalers, agricultural stores and vehicle dealerships, to extend credit, as this can now be secured against their customers’ business assets or outputs.
PSDI is now assisting the Government of PNG to raise awareness of the new system among both lenders and potential borrowers.