The Acting President, Yemi Osinbajo, yesterday, signed into law two bills from the National Assembly. These are the Secured Transactions in Movable Assets Act, 2017 (otherwise known as Collateral Registry Act) and the Credit Reporting Act, 2017. These bills, which have now become Acts, should ultimately boost the Nigerian economy and encourage the diversification drive of the present government as well as improve the Ease of Doing Business campaign of the FG.
In more direct terms, these Acts are expected to solve the 2 most significant problems that plague Nigerian entrepreneurs today- inability to access funds due to lack of immovable assets demanded by lenders and the often unfavorable ratings given entrepreneurs by lenders, mostly commercial banks, due to insufficient credit history. This is, in turn, likely to facilitate access to more affordable credit for entrepreneurs.
The Secured Transactions in Movable Assets Act, 2017, provides for the registration of movable assets such as motor vehicles, accounts receivables, and other movable assets while the Credit Reporting Act provides for credit information sharing between Credit Bureaus and lenders (such as banks), as well as other institutions that provide services on credit such as telecommunication companies and retailers.
A Credit Bureau is defined as a company that collects information relating to the credit ratings of individuals and makes it available to financial institutions, who need such information to determine an individual’s credit-worthiness and whether or not to grant loan applications to such individuals. The benefits of the Act are as follows.
Collateral Registry Act
- Entrepreneurs can now register their movable assets such as motor vehicles, equipment and accounts receivable in the National Collateral Registry.
- This official record of assets can now be accessed by lenders, commercial banks especially, and used as collateral for accessing loans.
- The expanded collateral options will increase MSMEs’ chances at accessing financing and tackle one of the major obstacles faced by them.
Credit Reporting Act
- The Act allow for credit bureaus to collate financial information of individuals and use such to rate them.
- Lenders will now have sufficient information relating to the credit ratings of individuals to make reasonable judgement on whether or not to extend credit to them
- For banks, this will reduce the cases of bad loans, which many complain is already crippling them.
- For MSMEs, they will now be better placed to receive favorable ratings and in turn, access
Access to credit is critical to economic growth and is considered to be the motor for driving private sector development. However, in Nigeria more than 70% of private enterprises, typically MSMEs, have limited or no access to credit.
In addition, credit applications get rejected due to insufficient credit history and information for the lender to use to make a reasonable judgement, as well as unacceptable collateral. The two new Acts remove those obstacles for MSMEs, thus allowing them to make a more significant contribution to the economy at large.
This 2 acts are not clear to most Nigerian even me,it smells of smarck of pride and prejudice.an average true Nigeria especially for the igbos owns 2 least 2 homes (1) where he work or earns his living in urban area (2)his village ,where he builts his castle or palace,do not get me wrong,i am not opposed to this 2 acts.i only differs can it works in Nigeria.it does not offers a credible accessment of credit suitability in nigeria
In the western world,once he start to earns salary,if he have a dog or wife and children,he buys a home by mortgage,and he can pays off his debt in 25 yrs,during this period.he can borrows on his home plus his mortgage,he can have his credit and debit card or any loan.which is not happening in Nigeria,people rents in Nigeria in urban area,hire purchase is non=existence in Nigeria.as family units are strong in nigeria.people borrows money to members of their family with no hope of it’s repayment.how many Nigerians have credit cards or mortgages.
This comes to this whistleblowing programme by the FEC,i saw Nigerian opnion on youtube yesterday,that this whistle -blowing will not work in Nigeria,they said a whistle blower,who will give a blow job to effcc,and at the end of the day,it will take at least a year even 10 yrs before he gets his reward or commission for this blow job,because the effcc have to go to court,which will take about a year or a few months.look at ajoke mohammed is in Holland,you have to extradict first,and he is fighting this effcc with his foreign resources.this whistle job blower may be killed by his enemy or die natural maybe old age ,not getting his money.
A half-baked idea,why not strengthen the law,funds and equips the police,you fight corruption on all front. there are many cases of financial crime of which the effcc have received petition still waiting to be investigated due to lack of resources and staff.is this the whistle blowing not the commercialization a of administration of justice in Nigeria ?.we knows where this whisling blowing idea came from. a form of bounty hunting, the bastardizing of administration of justice in nigeria
Prima facie,i have nothing against whistling-blowing programme,this is a rejoinder on the Nigerian media on this whistling blowing policy.I MEANS GOVT CAN DO BETTER THAN THIS.every body loves their country according to their degree of love or not according to.media report said this leakage about this ikoyigate and yakubu Andrew.
Any investigation have shown, that it was not a whistling action by any body in exposing anybody.IT MAY BE NOTHING WITH Mrs patience Johnathanthe govt have to prove she received this money corruptly, either by mes rea and act rea or by consipiration accessory of corrupt action,and this is does mrs johnathan influenced govt policies or govt contract and this is why govt found such big money in her bank account.
IT is not whistling action that produced this court action,thia corruption act have an anti-laudury process with bank.we Nigerian should not forget attempt was made against mr Ribadu life.is any whistler protected by law