Nigeria’s SEC says crowdfunding will accelerate financial inclusion

Written by on September 12, 2022

The Securities and Exchange Commission (SEC) says operationalising crowdfunding will accelerate the country’s financial inclusion agenda and boost Micro, Small and Medium Enterprises (MSMEs).

SEC executive commissioner, operations, Dayo Obisan, in a statement on Sunday, said crowdfunding could also increase the quantum of investible funds by unlocking the untapped capital in the economy.

He said crowdfunding had garnered much attention from regulators across jurisdictions because of its potential to further financial inclusion efforts.

He said the commission’s crowdfunding rules became effective on January 2021, with the primary objective of “investor safety”.

”This is to raise awareness for Nigerians on crowdfunding as a funding mechanism for start-ups and MSMEs, to enlighten them on experiences and lessons on crowdfunding from other jurisdictions.

”This is to also let the people know that it is an alternative way of investment and financing of businesses.

“It is strongly believed that the capital market has a leading role to play in this regard by collaborating with relevant stakeholders to map out strategies for deepening the market through financial inclusion,” he said.

Elizabeth Howard, the president, African Crowd Funding Association, said crowdfunding was the use of small amounts of money obtained from a large number of individuals or organisations to fund a project.

Ms Howard said the small amount obtained from many individuals could also be used to fund a business or personal loan and other needs through online web-based platforms. 

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