Law of commerce
Discuss the differences and similarities of the ppsa and the bank act regarding secured transactions,
including types of property, methods of securing the transaction, enforceability, and priority.
Introduction
The Personal Property Securities Act was specifically designed to consolidate and enable
efficient and widespread effective securitization of all personal assets. It allows most of the
citizens to obtain finance using secured assets or personal property that they possess or own. The
act achieves its effectiveness through the fundamental PPS regulation system that has perfected
the adoption of the Perfection-by-registration requirements. The register provides a public online
register to all interested parties that have security interests. The register maintains newly-created
security interests in one single accessible location. The major aim of the PPSA act is to provide
secured finance by accessing accurate information on potential debtors before any money can be
advanced to potential customers (Ross and Gunning, 2012).
The banking act has three major goals 1) Protect all the bank’s depositors funds 2) Ensure the
maintenance of adequate cash reserves and promote efficiency in financial systems. The banking
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act deals with the regulation of the financial system for example by requiring all the banks to
report all the banking activities to the federal bank’s commercial banking division or to the
inspector general of banks in commonwealth countries.
The major similarities between the two acts are that they both seek to control the money lent to
the public and maintain ways of protecting the public and also the institutions. However, the
major difference is that the PPS Act seeks to protect the institutions that lend money to habitual
loan defaulters and who through a system of a centralized register would be weeded out of the
system. The banking act through the requirement of cash ratios and reserves seeks to ensure that
the depositors are protected from inefficient banks.
The two acts present a system of regulating the financial systems and secure the interests of both
the public and the institutions.
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References
Ross, R. and Gunning, K. (2012) Personal Property Securities Act 2009,
