Registrars urged to create minimum operating standards to enhance regulation

The Nigerian Exchange Limited (NGX) has stressed the need for capital market registrars to configure digitalised minimum operating standards to enhance regulations, build a stronger operational structure and boost the stock market, which has recorded N2.3 trillion in transactions this year.

According to the Chief Executive Officer of NGX Limited, Jude Chiemeka, this would pave the way for the full adoption of electronic processing technology, which would help minimise the issue of delays and irregularities that hinder the smooth operations of the e-dividend mandate.

E-dividend is an electronic payment, which enables an investor’s account to be credited 24 hours after the dividend is paid.

Chiemeka added that if these issues are tackled, they would go a long way to improve registrars’ standards of service delivery and boost investors’ confidence.

He disclosed that the exchange has traded N2.3 trillion worth of transactions year-to-date (YTD), adding that the value is expected to hit N3 trillion by the end of the year.

He lamented the low participation of retail investors in the market currently put at five million. According to him, with 70 million BVN in Nigeria, the stock market is expected to take a large chunk from the figure.

Registrars have been criticised for frustrating the e-dividend process in Nigeria, investors have alleged that registrars make it difficult with their verification processes.

Chiemeka said the registrars have a critical role in amplifying available solutions in resolving investors’ complaints and other concerns in the market, noting that if the process of resolving issues is in line with the rules of engagement, it would boost investor confidence and drive participation in the market.

He pointed out that the efficiency of the market’s clearing, trading and settlement will enhance securitisation and attract the needed capital from the government and Nigerians in the diaspora to the market.

In addition, he called for registrars’ direct involvement in product development as they interface with investors.

“At the exchange, we recognise that the best way to attract capital is by creating the right assets and products. There is a need to engage with the next generation of investors who are digitally savvy and create products that resonate with this millennial because they want asset classes that are not traditional,” he said.