Yangon, Myanmar, November 5, 2016—IFC,
a member of the World Bank Group, is helping Myanmar’s government to develop
a secured-transactions framework that will allow businesses, especially
micro, small, and medium enterprises, to access finance by offering movable
assets as collateral. This will unlock significant financing for MSMEs,
for whom lack of access to finance is a key obstacle to doing business,
preventing them from growing, creating jobs, and contributing more to Myanmar’s
Today, access to formal financial services
in Myanmar is among the lowest in the world, standing at only 20 percent.
According to a World Bank Group survey of 1,000 Myanmar companies, around
92 percent of businesses relied on their own funds for business operations.
Businesses in Myanmar can currently raise funds basically only by pledging
immovable assets such as land and buildings as security.
is an indispensable aspect of financial inclusion in Myanmar,” said Than
Than Swe, Director General of the Central Bank of Myanmar. “Access to
finance is very difficult if MSMEs can borrow based only on immovable assets.
Myanmar needs a modern system to allow business borrowers to use movable
assets such as accounts receivables, inventories, equipment, title documents,
and intellectual property as collateral."
About 80 bankers, donor representatives, and government officials from
several ministries concerned—such as the Ministry of Planning and Finance,
the Ministry of Industry, and the Union Attorney General’s Office—attended
a symposium on secured-transactions reform in Nay Pyi Taw earlier this
week. Organized by the Central Bank of Myanmar and IFC, the event is one
of a series of activities to promote knowledge and debate on secured-transactions
reform in Myanmar.
“A secured-transactions system is critical
financial infrastructure for any economy. For Myanmar, this will be the
foundation to enable more financing for SMEs, farmers, traders, and infrastructure
operators,” said Vikram Kumar, IFC Country Manager in Myanmar. "We
are pleased to support the Central Bank of Myanmar and other stakeholders
to build up a modern secured-transactions system, leveraging our deep technical
knowledge and rich experience from supporting around 50 countries in this
IFC has promoted the concept of movable-assets
finance in Myanmar for several years. An ongoing advisory project, funded
by the United Kingdom’s
Department for International Development,
will support preparation and approval of a secured-transactions law, creation
of an Internet-based central collateral registry, and initial capacity-building
of lenders in structuring and monitoring movable-asset loans.
IFC, a member of the World Bank Group,
is the largest global development institution focused on the private sector
in emerging markets. Working with 2,000 businesses worldwide, we use our
six decades of experience to create opportunity where it’s needed most.
In FY16, our long-term investments in developing countries rose to nearly
$19 billion, leveraging our capital, expertise and influence to help the
private sector end extreme poverty and boost shared prosperity. For more
information, visit www.ifc.org