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The Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell is urging small businesses to secure their assets and business loans.

Carnell's calls come as economists and business experts predict a rise in insolvencies this year as government support measures come off.

Carnell says small businesses need to secure their assets through the Personal Property Securities Register (PPSR) so they are better protected in the event of an insolvency.

"Given the incredibly tough past 12 months we’ve had and predictions of a wave of insolvencies to come, PPSR has never been more important.

"The greatest pity is that many small businesses find it too difficult to use," she said.

Releasing its research paper into the PPSR, Carnell said that when used correctly the register can be a useful tool, however in its current form the PPSR is not user friendly.

"Many small businesses are not aware that correctly registering their interests can save them a world of pain in the long run.

"So many small businesses have invested heavily in their businesses over the past 12 months, but few know that they can secure these loans, pushing them higher up the security chain if there’s an insolvency.

"Unfortunately the PPSR in its current form is not making life easier for small businesses.

"The name is confusing, the language is overly technical and the operation of the register is very complicated.

"Many small businesses we spoke to said they would need a lawyer to help them register their interests – an additional cost burden for struggling small businesses," she said.

Solutions proposed by the ASBFEO to improve the functionality of the register include simplifying the system and introducing software solutions including pop-up boxes in business software.

"Our report recommends streamlining the system, including encouraging small business cloud accounting platforms in to provide regtech solutions such as pop-up reminders to small business owners who record a personal loan to the balance sheet, alerting them to register it on the PPSR.

"Put simply - systems and regulations imposed on small businesses by government need to be easy to get right and hard to get wrong.

"At the moment PPSR is hard to get right and easy to get wrong," she said.

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