Reforming Collateral Laws to Expand Access to Finance

Fleisig, Heywood ; Safavian, Mehnaz ; de la Peñ ; a, Nuria

Washington, DC:World Bank

关键词: ASSETS;    ASYMMETRIC INFORMATION;    BALANCE SHEETS;    BANK SUPERVISION;    BANKING SECTOR;   

DOI  :  10.1596/978-0-8213-6490-1
RP-ID  :  37096

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Most readers, especially those with carloans or home mortgages, know about collateral--propertythat the lender can take away from the borrower in the eventthat the borrower defaults. In low/middle income countries,it is understood that conservative lenders exclude firmsfrom credit markets with their excessive collateralrequirements. Usually, this is because only some property isacceptable as collateral: large holdings of urban realestate and, sometimes, new motor vehicles. Microenterprises,SMEs, and the poor have little of this property but they dohave an array of productive assets that could easily beharnessed to serve as collateral. It is only the legalframework which prevents firms from using these assets tosecure loans. In countries with reformed laws governingcollateral, property such as equipment, inventory, accountsreceivable, livestock are considered excellent collateral.This book aims to better equip project managers to implementreforms to the legal and institutional framework forcollateral (secured transactions). It discusses theimportance of movable property as a source of collateral forfirms, the relationship between the legal frameworkgoverning movable assets and the financial sectorconsequences for firms (better loan terms, increased access,more competitive financial sector), and how reforms can beput in place to change the lending environment.