As a hiring or rental business, the top priority (alongside regular revenue) needs to be the security, and retention of ownership, of any loaned or collateral assets. If your security stake in an asset is unproven, you may never either recover the good or be compensated for it, according to strict compliance guidelines. Liquidators and external administrators use registration on the PPSR to determine the hierarchy of creditors, so it’s imperative to ensure that this process is followed correctly. 

PPSR made simple: a guide for hire and rental businesses 

What Is the PPSR? The Personal Property Securities Register (PPSR) is an “online government noticeboard of security interests in personal property”. In other words, it is a regulated database of officially declared interests in specific items – including cars, goods, and company assets. When certain loaning, hiring, or rental agreements are made, the property in question (referred to as ‘collateral’) is used to underwrite the agreement. The register was implemented in January 2012 to create an official log of which parties have a stake in which collateral.  

What is a security interest? A security interest is a type of right in personal property as a result of an agreement, as defined by the Australian Financial Security Authority (AFSA). To further explain, “these are debts or other obligations secured by personal property”. If the loanee fails to meet their debt obligation, the secured party is eligible to take possession of the property. It is important to remember that only specific security interests are relevant to the register. Please note that short-term leases, hire, or rental arrangements (under two years) are said to not be affected by the PPSR. 

Why is registration on the PPSR important? If a trading partner to whom you’ve loaned property or credited under such an agreement goes insolvent, or fails to meet terms, the PPSR is fundamental to any efforts to recover that collateral. When an external administrator or liquidator is appointed to take over proceedings, they will create a hierarchy of creditors owed by that business. The higher up the ladder you are, the better your chances of payment.  

Registration on the PPSR allows you to be classified as a high-priority ‘secured creditor’, improving the chances of recovery significantly. Failure to register will downgrade your creditor status to unsecured – reducing the likelihood of success substantially. Your claim gets lumped in with those from every other unsecured creditor scrambling to obtain a payout. This process also factors in ‘retention of title’ scenarios – where a client takes possession of the property but doesn’t claim the title until payment completion. Registration on the PPSR similarly optimises the chance of recovery, in the event of default.  

Easily manage your registrations with PPSRLogic 

While proper registration with the PPSR is crucial for hiring and rental businesses, there are a great many that still neglect this essential task. It’s understandable, as the process can be time-consuming and might easily confuse even the most well-meaning team members when conducted in-house. Thankfully, there is an accessible, stress-free solution in PPSRLogic, powered by CreditorWatch. This innovative platform will transform the way you create, manage and renew security interests with the PPSR through the implementation of a number of useful features. 

With PPSRLogic, all registrations can be bulk-uploaded, saving time and resources for the team, while ensuring that all security interests are logged correctly. With ease of navigation and intuitive design, staff are empowered with the ability to complete registrations on one page with one click. Through the leverage of CreditorWatch’s extensive business data you can be sure that the information provided (including ABN, ACN, grantor details, and addresses) is relevant and accurate, whether new or imported.  

When it comes time to renew any registrations with the PPSR, the platform will notify you – allowing for additional peace of mind. These renewal reminders are essential towards maintaining the record and upkeep of your security interests, preventing a lapse in due diligence from exposing your business to unnecessary risk.  

Further, PPSRLogic can be easily integrated with ApplyEasy – CreditorWatch’s online credit application. Through use of both tools not only will your security interests be properly registered; your client onboarding workflow will also be transformed. ApplyEasy takes over from the dark-age paper-based credit application process for your customers, streamlining it into an online form. Mistakes and illegible handwriting will be a thing of the past, allow