NATIONAL NEWS
MONROVIA – The Central Bank of Liberia (CBL) has announced new measures aimed at reducing non-performing loans and expanding access to credit for businesses and entrepreneurs across the country.
By: Gegee Brima
The initiatives include the launch of an enhanced Collateral Registry on August 27, 2026, and a three-day National Non-Performing Loans Resolution Conference scheduled for September 9–11, 2026.
Speaking Thursday at the Ministry of Information’s Regular Press Briefing, CBL Senior Advisor Musa Kamara described non-performing loans, commonly known as default credits, as one of the major constraints affecting Liberia’s economic growth.
According to Kamara, previous financial sector reforms have reduced Liberia’s non-performing loan ratio from approximately 50 percent to 12.87 percent. However, he said the remaining level represents about US$71 million tied up outside the productive banking system.
Kamara noted that international best practices generally place acceptable non-performing loan levels at around five percent.
He explained that high levels of default loans make commercial banks more cautious about extending new credit while increasing borrowing costs, making it more difficult for credible businesses to secure financing for expansion.
Kamara attributed the persistent problem to several factors, including the lingering effects of macroeconomic shocks such as the Ebola epidemic, the limited market for resolving bad debts, and delays within the legal and judicial systems.
Although the Commercial Court was established to expedite financial disputes, Kamara said prolonged litigation continues to hinder asset recovery and weaken confidence among lenders.
National Conference to Address Bad Loans
The upcoming National Non-Performing Loans Resolution Conference is expected to bring together representatives from the Executive, Legislature and Judiciary, along with sub-regional central banks, international development partners and grassroots business organizations.
The conference is intended to develop a coordinated national policy response to Liberia’s non-performing loan challenge and identify practical measures to improve the recovery of bad debts.
Meanwhile, CBL Senior Director for Regulatory Affairs Mohammed Donzo said the enhanced Collateral Registry is designed to address another major barrier to economic growth: limited access to loan capital for small businesses and local entrepreneurs.
Donzo said the upgraded system will allow financial institutions to accept movable assets, including vehicles, machinery and inventory, as collateral. The move could enable small businesses to secure financing without relying solely on large fixed assets such as land and buildings.
New Registry to Strengthen Collateral Verification
A major feature of the new system will be the mandatory registration of collateral involving both movable and immovable assets.
Donzo explained that the system will allow lenders to conduct searches to determine ownership of an asset and establish whether another financial institution already holds a priority claim over it.
He said the system is expected to reduce the risk of borrowers using the same property as collateral for multiple loans, helping protect financial institutions from potentially unrecoverable debts.
The enhanced registry will also support digital payments, allowing users to pay registration and related service fees through mobile money and banking applications without having to physically visit the Central Bank.
The platform will further integrate with the National Identification Registry, Liberia Land Authority and traffic management databases to facilitate identity, ownership and title verification.
Developed with support from the World Bank through the LIFT Project, the enhanced Collateral Registry is expected to be launched on August 27.
Commercial banks will reportedly be given a six-month grace period to register existing collateral under the new system.
The CBL says the two initiatives form part of broader efforts to strengthen Liberia’s financial sector, improve lending conditions and ensure that more businesses, particularly small and locally owned enterprises, can access affordable credit to support investment and job creation.
