Draft Bill Allowing Movable Assets to be Taken as Collateral under Preparation

Addis Ababa  February 21/2019 A draft bill that enables banks to take movable assets as collateral for lending is under preparation, according to National Bank of Ethiopia.

Furthermore, the draft bill will provide opportunity for those who are unable to forward either movable or immovable assets to submit their creative ideas as collateral to qualify for credits.

The draft bill will reportedly help to solve the financial constraints citizens who want to engage in various activities face due to lack of financial resources.

Governor of the National Bank of Ethiopia, Yinager Dessie said the draft bill will provide opportunity for those who possess movable assets but lack the necessary startup capital.

As provision of credits by retaining movable assets is new to Ethiopia, the experiences of other countries have been adopted, he added.

Yinager further revealed that a revised bill under preparation will also avail opportunity to foreigners of Ethiopian origin to participate in the financial sector of the national economy.

He noted that as part of the institutional reform program of the bank, 10 regulations were annulled while 3 new draft bills are prepared for ratification.