The Personal Property Securities Register (PPSR) is an official government register of interests in personal property (items such as motor vehicles, goods sold on credit terms and other financial property).
It’s an online register that is public record, showing all secured creditors to a business and individuals. Importantly, it is not a register of ownership; nor does it show any interests over land/property – (the land titles register is where you go for those searches).
How to use the PPSR is often not fully understood and can be confusing. However, it can be the most effective tool for a credit manager or CFO to mitigate business and credit risk. PPSR registrations can provide protection for business owners from unfair preference payments or clawbacks from liquidators. A registration also makes a business a secured creditor and effectively takes you out of the paddock with other unsecured creditors to give you a much higher priority.
Why search the PPSR?
In addition to registering your assets on the PPSR, there are several reasons why searching the PPSR is important for businesses:
- If you are taking on a new customer OR supplier; it is the ONLY way to determine who the secured creditors of a business are. Why is this important? Because secured creditors will always get first rights to assets held on retention of title to a business and a financial return for debts owing. Unsecured creditors usually miss out in the event of insolvency.
- The PPSR details who these providers, suppliers and financiers to a business are (all banks, second-tier lenders, asset finance businesses etc register their interests in their borrowers on the PPSR).
- It will show you when these suppliers and financiers registered their interest on the PPSR. This is extremely important for the registered security interests as it can quickly and easily identify businesses that may be shopping around for several different lenders or identify businesses that have been rejected for finance from a tier-one bank and are resorting to other lenders.
- If a business has a significant number of registrations in a short period of time (and it is not a newly formed business), it is a strong indicator that it may be suffering cash flow problems and using multiple providers/suppliers to spread its exposure/raise its borrowing capacity across suppliers.
The value of PPSRLogic
Creditorwatch’s PPSR platform, PPSRLogic, can provide you with all your PPSR Search and registration needs.
Combining the value of CreditorWatch’s credit reports and scored insights, along with a PPSR search will provide your business with a comprehensive view of the credit worthiness of a customer and ability of your suppliers to meet their repayment and commitments.
If you also wish to register a security interest on the PPSR, you can complete this process confidently and by significantly reducing the changes of errors. Register a PPSR via a credit report with just three mouse clicks!
For more on how you can use the PPSR to protect your business’s interests contact CreditorWatch’s PPSR Specialist (NSW) Paul Mead or PPSR Specialist (VIC) Jason Sutherlin today.
