The Securities and Exchange Commission (SEC) has said the Crowdfunding operation will accelerate the financial inclusion agenda in Nigeria, while increasing the amount of investable funds by unlocking untapped capital in the economy.
The Executive Commissioner of Operations of the SEC, Mr. Dayo Obisan, stated this in a webinar with the theme “Accelerating Financial Inclusion through Crowdfunding”.
Crowdfunding platforms are websites that allow interaction between fundraisers and the crowd. In line with this, crowdfunding has attracted a lot of attention from regulators in all jurisdictions because of its potential to increase financial inclusion efforts.
Obisan said the event, organized by the SEC, is the first in a series, since the commission’s rules governing crowdfunding came into effect in January 2021 with the main objective of “Investor Safety ” and which aims to provide a platform for sharing knowledge and experiences. among the participants.
“It is also to sensitize participants, and indeed Nigerians, on crowdfunding as a funding mechanism for start-ups and MIMES, to enlighten them on experiences and lessons on crowdfunding d “other jurisdictions, as it is an alternative form of investment and financing of companies. ,” He said.
He described crowdfunding as a new phenomenon growing in popularity in Nigeria, adding that, the platform is an innovative source of funding that offers MSMEs and start-ups the avenue to raise capital from the crowd (population) by leveraging the power of the internet
According to him, “with the realization of the potential of crowdfunding, the rules of the Commission issued in January 2021, have taken concrete steps to improve the regulatory framework of crowdfunding by introducing the operational framework between fundraisers and the investing public in nigeria
“The framework, among others, makes it mandatory that any investment-based crowdfunding is operated only by crowdfunding intermediaries through the issuance of investment instruments. This will undoubtedly provide an additional opportunity for MSMEs, companies startups and the general public for faster fundraising options.
“We strongly believe that the Capital Market has a leadership role in this regard by collaborating with relevant stakeholders to map out strategies to deepen the capital market through financial inclusion, as well as continuous enlightenment programs focused on collective investment systems”.
Obisan commended the participants for their keen interest in the potential of achieving an all-inclusive capital market towards the progress and growth of the Nigerian economy. In her remarks, the Chairperson of the African Crowd Funding Association, Ms Elizabeth Howard, described crowdfunding as an umbrella term. which explains the use of small amounts of money, obtained from a large number of people or organizations to finance a project, a business or personal loan and other needs through an online web platform.
The director of operations of the National Association of Securities Dealers, Mr. Eguarekhide Longe, stated that crowdfunding could help mobilize capital for economic growth and development.