The Securities and Exchange Commission (SEC), has said that the implementation of crowdfunding in Nigeria will speed up the financial inclusion agenda and increase the amount of investable funds by releasing the economy’s unused capital.
Executive Commissioner Operations SEC, Mr Dayo Obisan stated this at a webinar with the theme “Accelerating Financial Inclusion through Crowdfunding.”
The Securities and Exchange Commission (SEC), has said that the implementation of crowdfunding in Nigeria will speed up the financial inclusion agenda and increase the amount of investable funds by releasing the economy’s unused capital.
Websites that facilitate communication between fundraisers and the public are known as crowdfunding platforms. In keeping with this, regulators from various jurisdictions have paid close attention to crowdfunding because of its potential to advance efforts to increase financial inclusion.
The SEC event, according to Obisan, is the first of a series since the Commission’s rules governing crowdfunding went into effect in January 2021, with the primary goal of “investor safety,” and to give participants a forum for knowledge and experience sharing.
“It is also to raise awareness of participants, and indeed Nigerians, on crowdfunding as a funding mechanism for Start-ups and MSMEs, to enlighten them on experiences and lessons on crowdfunding from other jurisdictions as an alternative way of investment and financing of businesses.
He described crowdfunding as a new phenomenon growing in popularity in Nigeria, adding that the platform is an innovative source of finance that provides MSMEs, and startups the avenue to raise capital from the crowd (populace) by harnessing the power of the internet.
According to him, “in realisation of the potentials of crowdfunding, the Commission’s Rules issued in January 2021, has taken concrete steps to improve the regulatory framework for crowdfunding by the introduction of the operational framework between the fundraisers and the investing public in Nigeria.
“The framework amongst others makes it mandatory for any investment-based Crowdfunding to be operated only by crowdfunding intermediaries through the issuance of investment instruments. This will no doubt provide an additional opportunity for MSMEs, startups, and the general public to have quicker fundraising options.
