The International Finance Corporation (IFC), a member of the World Bank Group, and the Eastern Caribbean Central Bank (ECCB), on Thursday, announced the signing of a memorandum of understanding (MOU) that aims to expand access to finance for small and medium-sized enterprises (SMEs) in the Eastern Caribbean Currency Union (ECCU).
Through the MOU, the IFC and the ECCB will establish Secured Transactions Collateral Registry Programme, which is a common legal framework that will allow SME owners throughout the ECCU to use movable assets as collateral when applying for loans. These assets include: machinery, crops, and accounts receivables.
According to a joint release from the organisations, the objective is to create a centralised, shared registry in the region, based on international standards established by the United Nations Commission on International Trade Law (UNCITRAL), that can be customised to each country’s particular case.
“Financial inclusion continues to be a pressing issue throughout the Caribbean,” IFC Regional Manager — Caribbean Judith Green stated during a virtual ceremony held to symbolise the signing of the MOU.
She added that having a strong, modern credit infrastructure will help to increase the types of credit products available to both individuals and SMEs.
As part of the MOU, the ECCB and the IFC will also co-host knowledge-sharing and capacity-building initiatives with representatives from the various governments, financial sector, and other stakeholders across the region.
For his part, Governor of the ECCB Timothy Antoine welcomed the MOU, highlighting that it was aligned to the ECCB’s Strategic Plan 2017-2021, which aims to create a stronger, more diversified financial system.
“The ECCB recognises the power and promise of small businesses in respect of both job creation and innovation and is committed to building out a modern credit ecosystem that supports SMEs especially for women and youth,” he commented.