The Moveable Transactions (Scotland) Bill aims to reform the law to make it easier for businesses and individuals to raise finance using moveable property, like cars, machinery and intellectual property. Two new registers would be created to enable this reform.

Evidence shared with the committee in person and in writing provided almost universal support for the reforms in the bill as they apply to businesses.

Witnesses told the committee that the legal infrastructure that Scotland currently relies on is from the 19th century and Dr Jonathan Hardman from the Law Society of Scotland indicated that reform in this area was “needed drastically and as soon as possible”.

Reflecting on the potential for the development of a new high-cost credit market, Myles Fitt from Citizens Advice Scotland described the bill as “a shot in the arm for the high-cost credit industry, which is always waiting for the next opportunity”.

To improve the bill, and protect consumers, the committee’s report recommends that consumers should be excluded from the parts of the bill that would enable them to take out loans on moveable property.

The committee asks the Scottish government to consider how this can be done, without impacting on sole traders and early start-ups, who stand to benefit from the reforms.

The bill also stated that there would be a £1,000 threshold on the minimum value of assets that could be pledged to raise finance. If consumers are not excluded from this part of the bill, the committee would like to see this figure raised to at least £3,000 when the bill returns to Parliament for further consideration.

Stuart McMillan MSP, convener of the Delegated Powers and Law Reform Committee, said: “The evidence our committee has heard has demonstrated that this legislation, which will modernise Scots Law and help Scottish businesses. It was apparent that Scottish businesses have had to implement expensive work-arounds for some finance options however this bill will make Scotland competitive once again with this finance option.

“However, while the overall impact of the bill is positive, there are some important consumer protections that we would like the Government to address. We look forward to considering the bill further when it returns to the Parliament at Stage 2.”

“Thank you to the organisations, businesses and individuals that have shared their views on the bill with the committee.”