The Resident Representative and Head of the Liberia Mission of the International Finance Corporation (IFC) has assured the public that the Liberia Collateral Registry program launched in Monrovia on Wednesday to help businesses access credit using their movable assets, will work perfectly for the country.
Mr. Frank Ajibola Ajilore told a team of economic journalists at IFC’s central office in Congo Town Wednesday that the IFC mission would not have supported the registry project if it thought it would not work.
According to him, the Registry is a public database that contains information on security interests in movable assets and will bring increased transparency to Liberia’s credit system, potentially benefitting thousands of businesses in the country by unlocking large amounts of private capital.
“I cannot tell you how important the Collateral Registry will be. If you ask the ordinary business man what they use as collateral for loan between six to 18 months, they would eventually say that they don’t have anything. So the Collateral Registry directly addresses this sort of problem faced by businesses in this category,” he noted.
Mr. Ajilore explained that the registry system that has been created is truthful to the extent that everybody can have access. “You can create an account within the system and that it is ideal because the financial institutions are going to be the main users even though other institutions such as telecommunication companies and companies that provide infrastructure services like water and electricity can use it too,” he said.
The Liberia Collateral Registry will be seated at the CBL Training Center at the corner of Warren and Carey Streets, the Liberia Business Association (LIBA) headquarter on A. B. Tolbert Road in Paynesville and at other LIBA offices across the country.
The IFC Mission Head noted that the registry system is an open system that can be used by a wider segment of the public.
He pointed out that the registry will engender growth of the struggling micro small medium enterprise (MSME) sector of Liberia.
The Central Bank of Liberia (CBL) in collaboration with the IFC, launched the Registry on June 18 at a colorful ceremony attended by not only government officials, including the Liberian legislature; there was also strong representation from the judiciary, the private sector, including heads of all business associations, the Liberia Bankers Association and the media.
IFC’s robust role in making the Registry project a success was widely recognized by the Liberian government during the launch. This Collateral Registry is an important part of IFC’s strategy to support private sector growth in Liberia, especially the growth of smaller businesses, a senior government official said.
Working closely with public and private sector partners in Liberia, and with funding from our donor partners, IFC will continue to support innovations that will strengthen Liberia’s economy and support recovery and job creation, the IFC Resident Rep said.
He pointed out that IFC attached importance to the Liberia collateral registry program because the Corporation believes that the registry will yield the needed return for the economy. Although IFC’s investment in Liberia has not reached to the level Mr. Ajilore expects, he pledged that the Corporation will continue to work with the public and private sectors to ensure a better investment climate for Liberia.
“IFC’s key role in Liberia is firstly to engage with stakeholders (public and private) to build the necessary investment climate that allows the private sector to adequately operate,” he said.
Since 2010, IFC has been engaged with over 15 advisory-related programs in the country, the Collateral Registry being just one of those programs.
The IFC is on record for strongly providing advisory services to the public and private sectors in Liberia which subsequently led to the establishment of the country’s Commercial Code and Commercial Court, the reform of tax policy, improvement at the custom and excise and other key sectors of the economy.
With the Collateral Registry in place, Frank emphasized that businesses which have computers, printers and office equipment and furniture can use those items as collateral to access loans from the banks and other financial institutions. “This is the window that the Collateral Registry will open which will eventually lead to growth of small businesses.”
Many Liberians believe that the Collateral Registry, a financing innovation, is expected to support economic growth and job creation in the country by allowing smaller businesses to obtain loans using equipment, inventory, or other movable assets as collateral.