• Dr. Omran: Movable Guarantees Registry will reduce the time and effort upon publicizing creditors’ rights.
• Dr. Omran: The guarantees granted to the financier will reduce the cost of projects’ funding due to the low risks associated with providing financing and the low cost and ease of publicizing.
• Dr. Omran: The registry will encourage financing and lending institutions to expand financing especially for small and micro enterprises and it will contribute to the financial inclusion process.
Minister of Investment and International Cooperation, Dr. Sahar Nasr announced the launch of the Egyptian movable guarantees Registry in the presence of Dr. Mohammed Omran, FRA’s Chairman and Ms. Mona Zoba, GAFI CEO and Mr. Mohamed Kafafi, Chairman and CEO of I-Score (The Egyptian Credit Bureau), the company that manages the Registry.
The Minister said that activating the Registry will provide equal opportunities for all investors to obtain funding, which will support the flow of investments and job opportunities and improve Egypt’s raking in performance indicators.
The Minister pointed out that number of meetings will be held with representatives of the Financial Regulatory Authority (FRA) to finalize the strategy of financial inclusion of the non-banking financial sector as soon as possible.
Dr. Mohammed Omran- FRA’s Chairman revealed that the most expected parties to use the registry in publicizing their rights are banks, financial leasing companies, microfinance associations and other financing providers who have rights guaranteed by movables (equipment dealers and production inputs). This will reduce the risk of financing, thereby reducing the costs of credit. It also works to instill confidence in the donors as these movables secure their rights. In addition, it will revitalize investment movement and accelerate development process.
Dr. Omran added that the challenge remains is to raise awareness on the importance of Movable Guarantees Law and the advantages it provides to the financing agencies and projects, as well as how to deal with the electronic registry in a simplified way and that requires the cooperation and adoption of the media whether the readable, audio and visual means and others.
In addition , Dr. Omran noted that 11th March witnessed the achievement of the objective of Law No. 115 of 2015 on regulating movable guarantees which set an effective structure and system to facilitate the access of small and micro enterprises to finance granted by movables without the transfer of possession and extending the scope of movables that may be provided as collateral to obtain finance to include physical assets such as machinery, equipment, goods, receivables, inventory, livestock, moral movables such as patents, copyrights, future movables, agricultural products, and foreclosures arising from the operation of a production line in a company or factory , also, it includes adjudication of bankruptcy and liquidation .
Mr. Mohammed Kafafy, Chairman of the Board of Directors of the Egyptian Company for Credit Information (I-Score) also presented the challenges faced by the company to turn the project of establishing the movable guarantees registry into a fact that is completed on schedule. And now Egypt has the first movable guarantees registry that is established at the highest operating levels as it will represent a new shift in the financial sector ,the mechanization of business and facilitation of citizens to grant funding for the implementation of projects that the State pays great attention to in order to improve the economic situation.
He added that entrusting the establishment of the registry and its operation to the Egyptian Company for Credit Information (I-Score) is an extension of the trust given to the company in similar projects. He emphasized that upon establishing the Registry, the company took into account the usage of the latest technology to achieve the success and the goal of the said registry.
Dr. Omran noted that other markets have preceded us in that matter as more than 50 countries have established movable guarantees registry including the United States, Australia, China and Canada. He added that the number of countries seeking to develop their legislations or introducing new legislations for new electronic movable guarantees registries is increased, including developing markets, that is after the positive results of this mechanism.
It is worth mentioning that the Authority has already announced a limited – unprecedented – tender for establishing and managing the movable guarantees registry by specialized companies in this field in April 2017 and ended in mid-August last year, where two companies submitted a project to establish and manage the registry of 6 companies obtained terms and conditions booklet. The tender included the design and establishment of an electronic registry to record movables guarantees rights, besides the management and operation of the electronic registry and its website, in accordance with the provisions of Movable Guarantees Law no. 115 of 2015. Finally, FRA chose the Egyptian Company for Credit Information (I-Score) for establishing and managing the Registry.