Economy
Fintech: Investor Safety our Cardinal Objective—SEC
The Securities and Exchange Commission has said that the safety of investors and their investments in the capital market is one of its cardinal objectives in rolling out its Regulatory Incubation Programme for Fintechs.
This was stated by the Director of Registration, Exchanges, Market Infrastructure and Innovation at SEC, Mr Abdulkadir Abbas, during an interview in Abuja.
Abbas stated that the regulatory incubation program is a program that is designed as an interim measure to actually facilitate genuine regulation of Fintechs activities that will conform to the capital market issues.
He said the idea of coming up with this program which is like a sandbox, is to be able to come and test innovative ideas as stated in the SEC guidelines adding that the incubation period would be open for one year.
According to Abbas, “It is just for testing, it will not be approved at that stage, but all Fintech ideas that conform with investment activities are defined in Investment and Securities Act 2007 can be tested under that kind of program. As we informed the market, there is going to be an initial assessment before it can be on-boarded into the regulatory incubation program.
The SEC Director said the Commission, through the RI, is providing an avenue where fintechs can test their ideas without affecting the market integrity, adding that one of the other objectives is to be able to create an opportunity to solve an existing problem in the market.
Abbas stated that the takeoff has been very encouraging, with the SEC gaining traction with market participants showing more interest and having commenced the first stage, which is the initial fintech assessment route.
He disclosed that before the take-off of the RI, the SEC has been having engagement with various fintech applicants, some of whom are existing capital market operators.
“Some are existing market operators; some are actually new interests in the market, so we have been having this kind of engagement. And from the time when we announced the takeoff till today, what has been happening is that a lot of applicants are actually accessing what we call the initial assessment form, so there is a need which we can now be able to provide the initial information, and that is the first stage of onboarding you into the RI, that is where we are now.
“And we have had a couple of engagements, and what interests us really is the traction of new fintech companies providing a solution to an existing problem in the market. But what we are trying to do now very quickly is to encourage more of these fintechs to come now that we have opened this phase. We believe that it will really deepen the market and it will facilitate bringing new products into the market and new ideas will come on board towards a solution of an existing problem in the market. As I said earlier, the principal plan is to actually provide an avenue of new solutions without compromising on investor protection which is our key objective”.
Speaking on the legitimacy criteria, Abbass said, “Right, there are five legitimacy criteria. First of all, you must have a kind of idea that will really bring a solution to an existing problem. That is one of the legitimacy criteria. Second, as a fintech company, you must be able to really fill out the initial assessment form and demonstrate to the commission that your idea or proposal or solution has conformed to the investment activity that has been under the scope of the ISA, which is our own purview.
“Thirdly, you must be able to be ready to test live using a new test scope of the market with live investors or live customers as it were, and then you must be able to commit that you will abide by the rules and regulations if you’re onboarding and the last issue is that you should be ready to now commit that once the rules are put in place after you come out of the regulatory incubation you must now comply with the existing rule that will come out as a result of that testing because we too we are trying to learn and by the time that we learn, we can be able to come up with a rule that would now fit that kind of activity.
“So, in terms of response, we just started we are already getting more applications; even this morning, we received quite a number. So, I can say we have quite a number of applicants that are really interested in this testing using the regulatory incubation that the SEC has come up with”.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange was down by 2.48 per cent on Friday, June 19, with the Unlisted Security Index shedding 108.36 points to close at 4,252.73 points compared with the previous day’s 4,361.09 points.
During the trading day, the market capitalisation of the OTC securities exchange dropped 2.18 per cent or N67.29 billion to settle at N2.552 trillion, in contrast to Thursday’s N2.609 trillion.
The alternative stock market was in the red yesterday after finishing with three price losers led by Central Securities Clearing System (CSCS) Plc, which gave up N8.57 to trade at N77.77 per share versus the preceding day’s N86.34. FrieslandCampina Wamco Nigeria Plc lost N8.19 to quote at N170.00 per unit compared with the previous session’s N178.19 per unit, and Food Concepts Plc crashed by 26 Kobo to end at N2.51 per share versus N2.77 per share.
Business Post reports that there were also three price gainers during the session, led by Golden Capital Plc, which chalked up 67 Kobo to sell at N13.67 per unit versus N13.00 per unit. Afriland Properties Plc gained 65 Kobo to trade at N16.85 per share compared with the previous price of N16.20 per share, and MRS Oil added 3 Kobo to close at N142.23 per unit versus N142.00 per unit.
The volume of trades was up by 20.3 per cent on Friday to 954,106 units from 792,835 units, and the number of deals increased by 75 per cent to 35 deals from 20 deals, while the value of transactions went down by 12.9 per cent to N42.7 million from N49.0 million.
The most traded stock by value on a year-to-date basis was Great Nigeria Insurance (GNI) Plc, with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 67.8 million units exchanged for N4.7 billion.
The most traded stock by volume on a year-to-date basis was also GNI Plc, with 3.4 billion units valued at N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Dipo Olowookere
The local stock exchange remained in the red on Friday after it further depreciated by 0.62 per cent due to panic sell-offs in some bellwether equities.
NAHCO lost 10.00 per cent to trade at N148.50, Royal Exchange depreciated by 10.00 per cent to N1.53, GTCO slumped by 9.97 per cent to N115.55, First Holdco dropped 9.84 per cent to quote at N55.00, and Neimeth slipped by 9.60 per cent to N28.12.
On the flip side, Deap Capital increased by 9.89 per cent to N4.89, RT Briscoe expanded by 9.62 per cent to N13.10, International Energy Insurance advanced by 7.43 per cent to N5.06, Jaiz Bank gained 7.14 per cent to sell for N9.00, and Living Trust Mortgage Bank rose by 5.26 per cent to N4.00.
During the session, the energy index chalked up 2.35 per cent, but this was not enough to lift the Nigerian Exchange (NGX) Limited when the closing gong was struck by 4 pm to signify the close of trading activities.
This was because the banking sector lost 4.41 per cent, the insurance counter shed 1.52 per cent, the industrial goods space declined by 0.71 per cent, and the consumer goods segment tumbled by 0.13 per cent.
Consequently, the All-Share Index (ASI) contracted by 1,463.45 points to 235,941.27 points from 237,404.92 points, and the market capitalisation retreated by M939 billion to N151.327 trillion from N152.266 trillion.
The activity chart was topped by Access Holdings, which posted a turnover of 65.0 million shares valued at N1.5 billion. Zenith Bank sold 35.2 million stocks worth N3.9 billion, Sterling Holdings exchanged 28.4 million equities for N217.8 million, UBA transacted 16.3 million shares valued at N650.7 million, and GTCO traded 14.0 million stocks worth N1.8 billion.
In all, investors transacted 440.4 million equities for N24.7 billion in 50,273 deals, in contrast to the 691.6 million equities valued at N116.9 billion traded in 50,025 deals on Thursday, implying an uptick in the number of deals by 0.50 per cent, and a decrease in the trading volume and value by 36.32 per cent and 78.87 per cent, respectively.
By Adedapo Adesanya
The Naira again depreciated against the United States Dollar by N7.16 or 0.53 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, June 19, to N1,370.46/$1 from the previous day’s N1,363.30/$1.
In the same vein, the Nigerian currency lost N9.07 against the Pound Sterling at the official market yesterday to trade at N1,814.76/£1 compared with Thursday’s closing price of N1,805.69/£1, and crashed against the Euro by N6.43 to settle at N1,571.50/€1 versus N1,565.07/€1.
Also, the Naira weakened against the greenback in the black market during the session by N5 to sell for N1,390/$1, in contrast to the preceding day’s N1,385/$1, and at the GTBank FX desk, it shed N3 to close at N1,376/$1 versus N1,373/$1.
The official market’s FX liquidity has been facing pressure over the last three trading sessions, contributing to a decline in the official exchange rate due to rising demand for foreign payments.
FX reserves rose to $51.03 billion, the highest level since January 20, 2009, according to data obtained from the Central Bank of Nigeria (CBN). The figure also represents the highest since the beginning of the year and under the administration of the current Governor of CBN, Mr Yemi Cardoso.
The latest figure underscores the steady strengthening of Nigeria’s external buffers, which continues to reinforce investor confidence in the Nigerian economy and support exchange rate stability.
Meanwhile, the cryptocurrency market was mixed, with Bitcoin (BTC) up by 0.8 per cent to $63,225.80 after trading activity was relatively subdued due to a US federal holiday, as the absence of stock and bond market activity led to quieter conditions across crypto markets, even though digital assets continue to trade around the clock.
Further, TRON (TRX) also gained 0.8 per cent to sell at $0.3230, Binance Coin (BNB) jumped 0.5 per cent to $579.84, and Ethereum (ETH) appreciated by 0.1 per cent to $1,704.23.
On the flip side, Ripple (XRP) declined by 0.9 per cent to $1.13, Cardano (ADA) shed 0.8 per cent to trade at $0.1611, Solana (SOL) fell by 0.1 per cent to $69.23, and Dogecoin (DOGE) slipped by 0.1 per cent to $0.0831, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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