The Bank of Ghana (BoG) is urging citizens, especially borrowers and buyers, to understand their rights and the risks associated with using their assets as collateral and seek advice before pledging their properties.
This call by the Bank of Ghana forms part of its intensified effort to educate the public on the Collateral Registry.
According to the BOG, the use of an asset such as a car, inventory or land as collateral gives the lender a security interest – a legal right over the asset. This allows the lender to take the asset if one fails to repay the loan.
One can register both movable and immovable assets, including land, vehicles, inventories and household items.
Additionally, BoG’s Collateral Registry and the accompanying Secured Transactions Regime allow borrowers to use the same asset to secure loans from multiple lenders.
BoG notes that this system enhances transparency in the credit market, giving borrowers the power to leverage a single property or asset to obtain credit facilities from various financial institutions.
Meanwhile, pledging an asset does not mean transferring ownership of the property to the lender.
BoG says it is important for individuals to insist on getting a copy of the registration acknowledgement from the lender, informing the public that “when lenders accept your property as collateral, it is registered in the Collateral Registry System.”
The Bank of Ghana has been running the collateral Registry since February 1, 2010, offering opportunities for lenders to register their collateral provided by borrowers for loans.
A key objective of the Collateral Registry is to facilitate access to credit. The Registry also makes available to the public information relating to registered security interests in assets.
The Registry provides the platform for one to conduct a search on the collateral Registry System to ascertain if the property they intend to purchase or acquire has been used as collateral for a loan.
“Before acquiring any stake in a property, always verify whether an interest has been registered against it,” BoG added.
How to Conduct a Search on the Collateral Registry System
To check the status of any property, visit the Collateral Registry Ghana website at www.collateralregistry.gov.gh.
One can search using the borrower’s name, borrower’s identification number, collateral identification, asset owner details or security interest registration number.
Who Can Register
The registry is open to a wide range of institutions and individuals, including:
Banks, credit unions, and microfinance companies
Businesses, investment firms, and insurance companies
Government agencies and financial NGOs
Trade creditors and foreign institutions
Agents such as lawyers and consultants acting on behalf of lenders.
Is Collateral Registry Free?
The services of Collateral Registration cost GHS 20, while searches cost GHS 10 and late registration costs GHS 25.
For complete details on the payments and others, please refer to the Bank of Ghana’s official Collateral Registry PDF below.”
READ MORE NEWS ON www.atlfmnews.com
