MoU signing between FSDU and URSB to put in place a comprehensive Chattels Securities legal framework
The Financial Sector Deepening Uganda (FSDU) and Uganda Registration Services Bureau (URSB) have this morning entered into a Memorandum of Understanding signed at the office of FSDU, at Ruwenzori Towers, Kampala.
FSD is an independent, not for Profit Company that supports innovation, conducts research and helps to promote and improve policy, laws and regulations that shape the financial sector.
URSB is a statutory body mandated under Cap 210 of the Laws of Uganda to deliver a number of registration services to facilitate and enable the private sector growth by creating a better investment climate in the country. URSB is responsible for the registration of chattel securities, business names, companies, business documents, intellectual property rights, registration of marriages and licensing of places to celebrate marriages. URSB also handles insolvency matters.
The importance of establishing a movable collateral registry in Uganda has been prioritised in Uganda’s Second National Development Plan and Vision 2040. A chattel means any item of property other than real estate. Something that a person owns other than land or buildings. Such a property that can be staked as collateral in any financial institution to get credit for business purposes.
The MOU between FSDU and URSB is aimed at implementing a comprehensive Chattels Securities Registry that is in line with international best practices. The MOU also focuses on sensitising key stakeholders on the usage of moveable property as security for loans.
The execution of this MOU signals FSDU and URSB’s commitment to establishing a modern Chattels Securities Registry to promote the usage of chattels as collateral in borrowing from financial institutions by MSMEs in Uganda.
This partnership presents new direction on broader financial inclusion and seeks to facilitate Micro, Small and Medium Enterprises to access affordable credit from financial institutions. MSMEs employ a sizeable number of citizens and also supports Uganda’s economy through direct and indirect taxation. MSMEs contribute as much as 75 percent of Uganda’s GDP and employ more than 2.5 million of Uganda’s workforce.
The purpose therefore of signing this MOU is not only to ensure cooperation between the two entities, but to have an effective chattels securities regime in Uganda.
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