The PPS Registrar’s roundtable held an interesting discussion about PPSR and where small businesses fit into it. The main theme emerging from the roundtable discussion was that small businesses feel confused. Small businesses fall into three categories:
- Those who don’t know about PPSR
- Those who know about it but can’t comprehend it as it is contrary to long-held views on ownership
- Those who know about it but don’t understand the complexity of the law of the register
All participants agreed that there was a lack of awareness of the PPSR amongst the small business community, especially people starting a business and apprentices. Some of the topics of the lowest awareness included:
- Scenarios where short-term leases move to longer-term leases and become a PPSR lease
- To enforce a security interest, the secured party needs to take action
- Registering correctly is essential
- The need to ensure a security agreement is supported by documentation
Secured parties identified the need for tailored messaging of what the benefits of the PPSR are for their business and what are the risks are if they do not engage with and use PPSR.
Participants also agreed that the support networks available for small businesses who wish to engage with the PPSR were limited and contributed to:
- Limited understanding of the PPSR by key professional groups that interact with small business
- Absence of basic advice through various channels including AFS and business.gov.au
- Lack of training material
- Limited access to registration support services
- Limited access to a simple registration process
The complexity of the legislation was discussed as it makes it difficult for businesses to register. They spend time interpreting in addition to documenting the details of their contract. The list of items they find difficult includes:
- Complex terminology not used by small business (personal property, ALLPAP, PMSI, etc)
- Register is not intuitive and can be enhanced for functionality
- Party identification is complex
- Timing is crucial
- Complex search results with large number of registrations returned
What some small businesses might not be aware of is that CreditorWatch fills in many of these gaps with PPSR Logic. PPSR Logic is a new innovative platform which has been created on the basis of making the PPSR experience easier for customers. It identified many areas of complexity with PPSR and in turn, addressed these concerns, providing a better experience for customers.
The roundtable discussed that there was a need for a simple registration process. PPSR Logic is very easy to navigate and registrations can be completed across one page with one click. In addition, templates can be created. Registrations can be uploaded in bulk and amended, without the need to start a registration from scratch.
The PPSR Logic portal can be integrated with ApplyEasy, CreditorWatch’s online credit application. In addition, PPSR Logic can help to identify missing or incorrect information such as ABNs, ACNs, grantor details, addresses and more. This fills in the gap for party identification and functionality.
PPSR Logic allows you to import existing registrations and receive alerts for which registrations are about to expire soon or which ones you need to amend. This fills in the gap for complex search results and crucial timing.
In addition to the product, CreditorWatch has its very own PPSR Specialist who can answer many questions. CreditorWatch also has loads of supportive content available from webinars, to a PPSR blog series, to a terminology infographic put together by Ledlin Lawyers. CreditorWatch also works closely with PPSAdvisory. This fills in the gap for terminology and lack of support.
For legal advice specific to your situation, please contact a third party.
For more information about PPSR Logic, contact CreditorWatch.
More articles like this: PPSR Series Part 1: The Lowdown on PPSR