Many Nigerians still excluded from capital market, says SEC

The Securities and Exchange Commission has stated that about 40 percent of Nigerians who are financially excluded, especially those between the ages of 18 and 35, are also excluded from participation in the Nigerian capital market.

This was stated by Director General of the SEC, Lamido Yuguda, who was represented by the Executive Commissioner Legal and Enforcement, Reginald Karawusa, at a webinar organised by the Commission, with the theme: “Digital platforms: New Frontier for capital Market inclusion.”

According to him, the Enhancing Financial Innovation and Access 2020 Report on the Nigerian “FinTech Landscape and Impact Assessment Study”, as at December 2018, showed about 40 percent of Nigerians were still financially excluded, with 51.1 percent of the excluded population women, while 61.5 percent are between the ages of 18 and 35. Also 34 per cent had no formal education and 80.4 percent resided in rural areas.

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This low level of involvement in the market has spurred the Commission to intensify its investor education efforts to attract greater participation in the capital market by both existing and potential investors, he said.

Yuguda said: “As the apex regulator of the Nigerian capital market, with a dual mandate to regulate and develop the market, it is investors, whether retail or institutional, that provides the savings needed for productive investments. Inclusion of the excluded population is therefore critical for deepening a sustainable capital market

He said SEC also recognizes the importance of digital platforms for democratizing access to capital market products and services for greater financial inclusion in the capital market.

The SEC boss asserted that the capital market, as part of the Fintech ecosystem, is witnessing changes in the conduct of market activities with the emergence of digital platforms which provide wide scale, cost effective and efficient solutions for inclusion of potential investors in the capital market, especially the younger population.

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Yuguda said: “Since 2018, the Commission has been engaging stakeholders within this space to develop an efficient regulatory framework that will mandate responsible digital financial practices to protect investors or consumers.

“The discussions and insight from this webinar, therefore, will be instrumental in shaping the regulatory landscape for the operation of these platforms, as well as support our efforts in securing the mutual benefits from their emergence.”

He restated the Commission’s objectives, which are to build a modern, efficient and low cost market characterised by adequate product offerings, efficient processes and market integrity.

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“We must do this continually by raising standards, embracing new technology, introducing new products, enhancing our processes, widening the investor-base, invigorating investor education and providing an enabling regulatory framework to support it all,” he added.

In his remarks, Director Market Development Department at the SEC, Edward Okolo, said the topic for discussion is apt based on prevailing circumstances and global realities.