The Securities and Exchange Commission (SEC) has emphasized the need for well-informed investors to sustain market confidence and ensure financial stability, especially in the rapidly evolving landscape of digital finance. This message was delivered at the opening ceremony of the 2024 International Organisation of Securities Commissions (IOSCO) World Investor Week (WIW) by SEC’s Director-General, Dr. Emomotimi Agama, who was represented by the Executive Commissioner of Operations, Bola Ajomale.
Speaking at the event, Agama stressed that investor education remains essential in maintaining a healthy financial ecosystem, particularly as complex and technology-driven financial products continue to emerge. “As financial products become more complex and technology-driven, from fintech innovations to cryptocurrency trading, it is critical and responsible for stakeholders to commit to equipping investors with the knowledge to navigate these markets confidently and responsibly,” he said.
The 2024 edition of WIW, which focuses on technology, digital finance, crypto assets, and sustainable finance, comes at a crucial time for Nigeria’s capital markets. Agama noted that these areas are reshaping the global financial landscape and will have a profound impact on the future of capital markets. He urged market participants to leverage the week’s activities to learn, share knowledge, and strengthen efforts towards building a robust and investor-friendly ecosystem.
“WIW provides a platform for us to reinforce this commitment. Throughout this week, we will engage with investors, discuss best practices, and focus on improving transparency and accountability in financial markets,” Agama added.
Fintech Transforming Nigeria’s Financial Landscape
Fintech innovations have played a pivotal role in democratizing access to financial services, reducing transaction costs, and increasing the efficiency of market operations. In Nigeria, the adoption of mobile technology and digital payments has demonstrated immense growth potential in the digital finance sector.
Agama highlighted the transformative impact of fintech on Nigeria’s financial markets, stating, “The rise of technology in finance is reshaping the way capital markets function, creating opportunities for greater efficiency, transparency, and inclusion. Fintech solutions are democratising access to financial services, reducing transaction costs, and enabling faster, more secure operations across the market.”
He also pointed to the rapid growth of Nigeria’s cryptocurrency market, particularly in peer-to-peer transactions, while acknowledging the high volatility of this space. Agama noted that while the potential for growth in digital finance is vast, ensuring investor protection remains paramount.
Regulatory Frameworks for Emerging Markets
The SEC has made significant strides in regulating the cryptocurrency space in Nigeria. It has released frameworks for overseeing virtual asset service providers (VASPs) to mitigate risks such as fraud, money laundering, and market manipulation while fostering innovation. Agama reaffirmed the SEC’s commitment to ensuring that emerging markets, such as crypto assets, operate within a well-regulated and safe environment that maintains market integrity.
“Our frameworks balance the need to encourage innovation within a safe, regulated environment whilst maintaining investor protection. Crypto assets must be subject to clear regulatory oversight that ensures market integrity without stifling growth,” Agama said.
He emphasized that maintaining a balance between innovation and regulation is essential for market sustainability, especially as new technologies continue to drive the global financial sector.
As the IOSCO World Investor Week continues, industry stakeholders are expected to focus on ways to enhance investor education and protection, ensuring that Nigeria remains a key player in the global financial markets.
