Increasing access to credit through reforming secured transactions in the MENA Region

This paper provides a comparative summary of secured transactions systems related to the use of movable property as collateral in the MENA region vis a vis international practices in countries with modern secured transactions systems. The paper sets out the importance of introducing reforms in the area of secured transactions with the objective of increasing access to credit for businesses, particularly SMEs. The MENA region clearly lags behind all other regions in the introduction of secured transactions reforms. The paper summarizes many of the weaknesses common across the region. The two main critical areas that need urgent reforms are the creation of modern secured transactions laws and electronic movable collateral registries, and the need to improve enforcement mechanisms for security interests in movable property.Debt Markets,Bankruptcy and Resolution of Financial Distress,Access to Finance,Emerging Markets,E-Business

Credit Creation: Reconciling Legal and Regulatory Incentives

As international organizations adopt new legal standards to promote access to credit through the modernization of national secured transactions law, the lack of coordination with regulatory standards for banking institutions thwarts the effectiveness of these efforts. In recognizing the relevance of the problem, UNCITRAL - for the first time since its establishment - is currently considering how to coordinate secured transactions law reforms with the implementation of the Basel Accord. In a similar vein, the problem is currently approached by other international organisations. Although efforts at the national level to coordinate legal and regulatory standards are commendable, coordination between secured transactions law and capital requirements should be addressed at the highest level of the lawmaking process, i.e. when international soft-laws are defined. To advance this argument, the key functions of secured transactions law and capital requirements are isolated and a holistic understanding of the legal and regulatory rules governing the creation of credit is presented. The Article steers away from the idea that banks are mere intermediaries and offers a fresh understanding of the role of regulatory capital in controlling credit creation, through the management of risk. Within this context, the incentives created by secured transactions law and capital requirements are examined by comparing the capital charges for different credit protections, including credit derivatives and commercial loans to small business. First, it emerges that the implementation of new secured transactions law and the limited ability of security interests in personal property to reduce regulatory capital under the Basel Accords stimulate the creation of credit outside the banking system. Second, to control this phenomenon, the Article shows that it is essential to reconcile the incentive structures created by international legal and regulatory standards

Secured Transactions

Introduction to secured transactions : collection of debts and liens -- Scope of Article 9 and types of collateral -- Remedies : the secured party\u27s rights against the debtor -- Creation of a security interest -- Perfection of security interests -- Priorities -- Some basic bankruptcy concepts.https://digitalrepository.unm.edu/law_facbookdisplay/1005/thumbnail.jp