The loan will be utilized for the development of the Land Registration Systems or LARES, which will computerize and connect the 160 LRA offices nationwide. The LRA is a line agency of the Department of Justice (DOJ) tasked to preserve the integrity of the land registration process and protecting the sanctity of land titles.
The five-phase project also includes a $2.75-million equity investment in LARES.
"For a well functioning system of property rights to develop, the ownership of land has to be formalized through an effective land titling and registration system," IFC infrastructure director Francisco Toureilles said in a statement.
"By providing a secure record of land ownership and a more efficient retrieval and record management system, this project will facilitate the use of titled land as collateral for borrowing by individuals," he added.
The project covers the first three phases of a five-phase, 10-year build-own-operate (BOO) concession and allows LRA to maintain online information on land titles that are current, complete, and accurate.
The IFC said that the security and integrity of records would be ensured by the system. It will also implement land registration procedures, and provide timely responses to customers through user-friendly electronic information access to the LRA central office and all deed registry offices.
The modernization of government services and improved access to accurate records for the public is part of the IFC’s goals.
Following its implementation, small and medium enterprises (SMEs) should see improved access to financing due to improved collateral based on clear property rights. The project also sets the stage for a more sophisticated mortgage market to develop, which can play a critical role in the overall development of financial markets.
The IFC is the private investment arm of the World Bank, mandated to promote private sector investment in developing countries. It finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses.