Individuals seeking to purchase assets such as cars and houses in the country have been urged to conduct checks with the Collateral Registry to avoid acquiring properties tied to existing or hidden financial liabilities.
It follows rampant reports recently to the security agencies of people who have fallen victim to purchasing properties that have already been used as collateral for loans, exposing them to potential legal and financial risks.
As a result, the registry provides a platform to verify whether an asset is encumbered — meaning it has been used as collateral for a loan — which is critical before completing any transaction.
Speaking to the media at a sensitisation workshop on the Borrowers and Lenders Act, 2020 (Act 1052) in Accra yesterday, April 23, the Head of the Collateral Registry Department at the Bank of Ghana (BoG), Fred Asiamah-Koranteng, said failure to conduct such searches could result in buyers unknowingly inheriting legal disputes or losing the asset if a lender moves to enter the assets due to loan default.
“A simple search at the registry can save individuals from costly litigation and the risk of losing assets they have already paid for.
“And so, before you commit to any purchase, especially high-value assets, it is important to verify their status to protect your investment and avoid future complications,” he said.
The workshop
The workshop was organised by the BoG in collaboration with the Association of Ghana Industries (AGI) to sensitise members of the business association to the Borrowers and Lenders Act and the operations of the Collateral Registry.
It was to help participants to understand how to access credit more efficiently by leveraging the collateral registry system, which allows individuals and businesses to register assets and verify their status before using them as security for loans.
The event was attended by the President of AGI, Kofi Nsiah-Poku; the Chairperson of AGI Women in Business, Dr Grace Amey-Obeng; an Advisor to the Governor of the Bank of Ghana, Franklin Belnye; Chief Executive Officer of AGI, Seth Twum-Akwaboah; and other dignitaries.
Easy accessibility
Mr Asiamah-Koranteng explained that the process for the use of the collateral register was simple, affordable and accessible online, allowing individuals to conduct searches from anywhere using basic asset details.
He said a nominal fee was charged for each search, making it a cost-effective step compared to the potential financial loss associated with disputed ownership.
Credit infrastructure
Mr Belnye, who represented the Second Deputy Governor, stated that the engagement with industry was critical to strengthening the country’s credit infrastructure and improving business financing conditions.
He said the recent macroeconomic gains, including easing inflation and reduced interest rates, had created a more favourable environment for private sector growth, but access to credit remained a key challenge for businesses.
Mr Belnye explained that the Borrowers and Lenders Act and the Collateral Registry were designed to address issues such as information gaps and collateral constraints, which had historically limited financing opportunities for firms.
“The secured transactions framework and the collateral registry were not just legal tools, but practical instruments designed to unlock credit, support business expansion and ensure that the private sector fully benefitted from Ghana’s improving economic conditions,” he said.
Macroeconomic stability
For his part, the AGI president said macroeconomic stability had improved lending conditions and underscored the importance of collaboration between industry regulators and financial institutions in strengthening the country’s credit environment.
Mr Nsiah-Poku stated that the Borrowers and Lenders Act, 2020 had represented a major step forward in promoting responsible lending, protecting borrowers’ rights and enhancing transparency and efficiency within the credit system.
He added that for businesses, particularly small businesses, access to finance had remained a critical driver of growth, expansion and sustainability, but had needed to be supported by clear rules, mutual accountability and a shared understanding of rights and obligations.
Source:
www.graphic.com.gh