Land registration and access to SME credit: preliminary findings

Abstract

Land registration has assumed popularity around the developing countries for quiet sometime; the argument that it is capable of enhancing access to credit is often the underlying factor for implementing land registration programs. Several studies in the developing world have not found any significant relationship between land registration and access to credit. The aim of this paper is to establish whether or not the absence of registered land titles is a barrier to credit access amongst small enterprises in Ghana. The study involved credit officers and the results amongst other things show that as far as the main stream commercial banks are concerned, landed property is not eligible for use as collateral unless it is formally registered. Unregistered property is however accepted as collateral by the microfinance institutions. Therefore the exact impact of land registration on credit access may vary depending on the type of lender.