SANTO DOMINGO- The Association of Multiple Banks of the Dominican Republic (ABA) positively assessed the first year of operation of the Electronic System of Movable Guarantees (SEGM), a platform managed by the Ministry of Industry, Commerce and MSMEs (MICM) that facilitates the use of movable assets as collateral for micro, small and medium-sized enterprises and other productive sectors to obtain formal financing.
The ABA expressed confidence in the potential of this system to encourage the strengthening of MSMEs, a sector that usually does not have real estate available (which is the preferred guarantee in the Dominican economic system), but does have machinery, equipment, patents, cash flow and even earnings from copyright that it can use as collateral.
He considered it significant that, in its first twelve months, the SEGM registered 78,267 new movable asset guarantees, representing 30.6% of the total, according to data provided by the Ministry of Industry, Commerce, and SMEs. He also specified that the electronic platform registered a total of 255,395 movable asset guarantees, including 177,128 registered prior to Law 4-20, which regulates the system.
The association also noted that 87.4% of all registrations remain active, while only 0.1% are currently being processed. Regarding the latter, it highlighted that the majority of registrations (47.42%) opted for extrajudicial resolution as the preferred method for asset foreclosure, to the benefit of all parties involved.
The ABA also highlighted the banking sector's support and commitment to economic development, growth, and the formalization of credit, as evidenced by the 30,936 new registrations made by financial intermediation entities, equivalent to 39.53% of those included in the system. It also commended the participation of leasing companies, which registered a total of 1,400 entries, representing 1.79% of all movable asset guarantee registrations in 2023.
It was noted that legal entities have a significant presence, representing 92.8% of debtors and 56% of users who register movable asset guarantees. The association inferred that the majority are small and medium-sized enterprises that have gradually adopted this modality to access formal credit in order to develop their productive activity.
The ABA pointed out that, among creditors, financial intermediation entities make up 15.7% of users who register guarantees and 2.8% corresponds to legal entities operating factoring and leasing.
The largest number of registered assets corresponds to motor vehicles (67.20%), as well as electronic equipment, heavy and agricultural machinery, among others, according to a report from the ABA's Legal Department. It details that 83,022 of these assets, nearly a third of the total, were registered in accordance with the new regulations.
In light of the above, the ABA considered that this effort by the public and private sectors, including local multiple banks, "constitutes an advance for agility and efficiency in the financial and judicial sectors, as it consolidates, on a single platform and in real time, the movable property guarantees held by individuals or legal entities, even with a future perspective.".
