The Securities and Exchange Commission (SEC), has restated commitment to making the capital market attractive to Nigerians at all levels alongside with new strategy to curtail unclaimed dividend.
Besides, the Commission has embarked on initiatives to encourage new products offerings for all classes of investors, including millennials and Generation Z to grow investor base and deepen the market.
Director General of the SEC, Mr. Lamido Yuguda stated this during a meeting with a team lead by the British Deputy High Commissioner, Ben Llewellyn in Abuja Friday during a courtesy visit to the Commission.
Yuguda said that the Commission was implementing various initiatives to ensure that products and offerings in the market are accessible to both the young and old which he to further deepen the market.
“When we assumed office, we were shocked to know that the average age of the Central Securities Clearing System account holder was over 50 years. The Central Securities Clearing System (CSCS) is a depository, so if you are investing in equities you must have a CSCS account.
“ The capital market experience starts with a bank account and eventually the distribution has to hit a bank account as well. So we decided to look at the whole process and find out what is turning young people off. We have started the process and seen how the tech companies are providing much needed relief to the kind of bureaucracy that happens in the capital market.
‘’ SEC recently approved an e-offer for MTN and expressed the excitement of the Commission that Nigerians especially those of the younger age bracket were able to participate in the offer.It was marvellously successful and we are very excited about it. A lot of young people who had never invested in the capital market took the MTN offer. That is one of the first step in a lot of steps we are going to take to make investing in the capital market a much nicer experience for people both young and old. We know we can move quickly and faster once we strengthen our infrastructure to do a lot more.
“ In this market what we have seen is that where people do have ready access to interesting products in the regulated market they then gravitate towards the parallel markets and the Ponzi schemes and really the task of the Commission is to as much as possible move money to the regulated market away from the Ponzi scheme that with e-offers, a lot of Nigerians would be happy to invest in the capital market and that would dissuade people from patronising illegal schemes thereby leading to the development of the capital market and the Nigerian economy.
Yuguda also stated that the Commission in its drive to attract more people to the market is focusing on a proper identity management system which would also aid in the reduction of the issue of unclaimed dividends.
“ One area we recognised we needed to attend to is the lack of proper identity management system in the market and this an area the Commission has really focused on. We have had over the past few decades a lot of unclaimed dividends in the market and we thought that the identity management could help solve the problem. I believe if we are able to do this to a logical conclusion it could unlock a lot more investors because I think the fact that people have money in the capital market and have not been able to claim them, it is not only bad for the people who have this money but it is also a disincentive for those trying to come in because they do not want their money to be trapped.
“ The more you can create alternative options the easier it is to pull people away from unregulated space and that is why the Sandbox is so attractive to us and why we encourage it. We come across these fintech players and they are formidably driven in their vision. “ Yuguda said.
He commended the relationship between the Commission and the UK government, noting that it had contributed to the growth and development of the capital market.
In his remarks, the British Deputy High Commissioner, Mr. Ben Llewellyn-Jones canvassed the need for the SEC to create more alternative options for investments for all classes of people as one of the ways of pulling people away from unregulated markets.
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