New measures to support smaller businesses
Business assets can be used more easily to raise funds.
Legislation to support smaller businesses to raise finance, helping them maintain income and address rising business costs has been published.
The Moveable Transactions (Scotland) Bill will give new opportunities to small and medium-sized enterprises (SMEs) and other businesses, allowing them to raise finance by securing funds against largely untapped assets like vehicles, plant and machinery or whisky stores.
The Bill proposes:
- modernising and simplifying the law on borrowing against moveable physical and intellectual property
- creating an easier way for businesses to sell unpaid invoices to banks or other financial institutions
Public Finance Minister Tom Arthur said:
“If businesses cannot fully take advantage of their assets to raise finance they might otherwise have to resort to riskier and more expensive types of borrowing.
“This Bill is vital to helping businesses and the wider economy.
“Greater access to business finance will support innovation and productivity, in line with our National Strategy for Economic Transformation.”
The Moveable Transactions (Scotland) Bill was introduced in the Scottish Parliament on Wednesday May 25. Read the Moveable Transactions (Scotland) Bill and explanatory material.
It outlines how assets could help secure a lower cost loan, under a lender’s security called a statutory pledge. The asset would be pledged by the borrower as protection against default on loan repayment and recorded in a new Register of Statutory Pledges.
Moveable assets covered include machinery, vehicles, commodities or intellectual property like copyright, trademarks or patents.
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