The federal government has entrusted the Secured Transaction Registry (STR) for unincorporated entities to the Securities and Exchange Commission of Pakistan (SECP).
The registry will record charges/security interests created by entities on their movable assets, an SECP statement said on Monday.
The Financial Institutions (Secured Transactions) Act 2016 provides an integrated legal framework for the creation of security interests over movable assets besides providing for the establishment of a secured transactions registry for unincorporated entities.
According to the details, STR will facilitate small borrowers from Small and Medium Enterprises and the agriculture sector to secure credit from financial institutions. It will be done against their movable assets such as receivables, intellectual property, inventory, agricultural produce, petroleum or minerals, and motor vehicles, etc.
STR is expected to improve Pakistan’s ranking in “getting credit” indicator of the World Bank’s Ease of Doing Business index that requires the establishment of an integrated or unified collateral registry to register security interests in movable assets by incorporated and unincorporated entities.
The SECP is already maintaining a registry of charges/security interests created by companies for moveable and immovable assets under the Companies Act 2017.