Video Transcript
Well, the PPSR actually has a dual role. Firstly, to allow any party that is considering advancing or providing credit to a borrower, they could do a search at the PPSR to determine are there any prior ranking financiers that have registered a security interest over that potential borrower. And then secondly, once the financial credit has been advanced to the borrower, the financier lodges their own security registration. Now, they’re formally registered over that borrower, and therefore in the event of the insolvency of that borrower, they are a secured creditor rather than an unsecured creditor of the business in liquidation.
