Direct Cash Settlement Will Boost Investors’ Confidence—NSE

September 19, 2017
Direct Cash Settlement Will Boost Investors’ Confidence—NSE

**Educates Stakeholders on Dematerialisation, Others

By Modupe Gbadeyanka

Executive Director of Market Operations and Technology at the Nigerian Stock Exchange (NSE), Mr Ade Bajomo, has disclosed that the direct cash settlement system will enhance investors’ confidence because proceeds from the sale of securities are remitted directly into investors’ accounts.

He made this disclosure last week at an enlightenment programme organised by the NSE for capital market stakeholders on dematerialization, direct cash settlement and e-dividend.

The event, tagged Investor Clinic and themed ‘The role of Dematerialization, Direct Cash Settlement and E-dividend in the development of the Nigerian Capital Market,’ took place at the Stock Exchange House, Lagos.

It was targeted at sensitizing the investing public and brokerage community of contemporary initiatives in the market.

The programme shed light on the importance of dematerialisation as a necessity in the trading of shares.

Participants were also made to understand the advantages of direct cash settlement and e-dividend processing in the consolidation of returns on their equity investment as well as the overall benefits to the Nigerian capital market.

“The NSE Investor Clinic brings to the fore the importance of dematerialisation in ensuring improved market velocity and integrity as well as the role of direct cash settlement in enhancing investor confidence by ensuring that proceeds from the sale of securities are remitted directly into investors’ accounts,” Mr Bajomo said.

He stressed the importance of e-dividend in not only reducing the perennial issue of unclaimed dividend growth, but in ensuring that investors derive the full benefits of their investments by having their dividends paid directly into their bank accounts as soon as these are disbursed by issuers, regardless of whether these are savings or current accounts.

He added that, “At The Nigerian Stock Exchange, we are committed to improving overall financial literacy and inclusion in the country, and ensuring we implement efficient processes that provide investors easy and intuitive access to grow their wealth.

“This commitment is expressed in the various initiatives undertaken by The Exchange. In 2016 alone, we executed over 200 free capacity building workshops, aimed at enhancing investor understanding of the workings of the capital market.

“The multiplier effect of these workshops is phenomenal, as over 25,000 participating investors have been equipped to make better investment decisions”.

Over 200 participants attended the NSE Investor Clinic which had seasoned and certified subject matter experts, such as Mr Henry Rowlands, Director, Capital Market Development, Securities and Exchange Commission; Mr Seyi Owoturo, CEO, United Securities Limited and Mr Kenneth Nwafor, Operations Manager, Market Operations NSE as facilitators.

It will be recalled that the Exchange on June 1, 2017, launched X-Academy, its financial literacy and inclusion platform designed to provide education services to individual, corporate and government institutions  who want to gain a better understanding of the various aspects of the capital markets and also improve overall corporate governance within their respective institutions. X- Academy offers a wide range of courses geared towards bridging the knowledge gap of investors and issuers about products and services of the capital market.

It is also a platform to enhance financial literacy and inclusion and build on our track record of pushing the boundaries of financial education in Nigeria across all segments of investors.​

This edition of the NSE Investor Clinic which was sponsored by ARM Pension Fund Managers Limited and Africa Prudential Registrars Plc.

Modupe Gbadeyanka

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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