All You Need to Know as SEC Starts Regulatory Incubation Program for Nigerian FinTechs
- FinTech platforms seeking to operate in Nigeria's capital market are required to undergo a regulatory program by the SEC
- The SEC disclosed that the portal for registration would be opened from April 28 to May 26, 2023
- The SEC noted that firms that are interested in applying for the program must demonstrate they meet its five eligibility criteria
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The Securities and Exchange Commission has opened the regulatory incubation program for fintech firms operating or seeking to operate in the Nigerian Capital Market.
The program, earlier announced by the commission in 2021, aims to support and regulate the growth of fintech startups in the country and help them navigate the capital market.
Source: UGC
It would be recalled that the Director-General of the SEC, Lamido Yuguda, had in a previous report by Legit.ng encouraged Nigerian youths to participate in the capital market to make money.
The SEC regulatory incubation program is expected to create an enabling environment for fintech startups to operate and grow in compliance with regulations.
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The program will also provide them with access to the necessary resources needed to succeed, including legal, technical, and business support.
Updating more details on its website, SEC affirms its belief in transforming Nigeria into a smart financial centre with innovative technology.
It stated:
The Regulatory Incubation (RI) program, according to the SEC, is designed to address the needs of new business models and processes that require regulatory authorisation to continue carrying out full or ancillary technology-driven capital market activities.
The RI Program has thus been conceived as an interim measure to aid the evolution of effective regulation which accommodates the innovation by FinTechs without compromising market integrity and within limits that ensure investor protection.
The SEC stated that the portal is ready to accept applications from Cohort 001/23 from April 28, 2023, to May 26, 2023.
SEC's Regulatory Incubation (RI) program
The Commission's Regulatory Incubation (RI) program aims to cater to the requirements of novel business models and procedures that necessitate regulatory clearance to pursue complete or auxiliary technology-driven Capital Market operations.
Its purpose is to serve as an interim solution to facilitate the development of efficient regulations that incorporate innovation from Fintechs without compromising market fairness and within boundaries that ensure investor protection.
The RI program functions by grouping specific Fintech business models and procedures into cohorts for one year. Participation in the program encompasses two phases, namely, the Initial Assessment Phase and the Regulatory Incubation Phase.
Applicants are required to complete the initial assessment phase before gaining approval to move on to the regulatory incubation phase. The selection of categories for each cohort is determined based on the Fintech assessment form submissions received.
Fintechs that can apply include:
- Registered Capital Market Operators
- Unregistered Fintech innovators that require regulation
- Firms of all sizes
- Special interest in firms that want to enhance investor participation in the Nigeria Capital Market
Eligibility Requirements
To be eligible for the Regulatory Incubation Program, applicants must meet the following five eligibility criteria:
- Your innovation is for application in the Nigeria Capital Market.
- Your innovation is safe for investors.
- Your innovation is a genuine innovation that introduces a new product/process to serve specific investor needs.
- Your innovation is able to solve existing compliance or supervisory issues (optional).
- Your innovation is ready for testing.
You are also required to provide as much information as possible about how you meet these criteria when submitting your application.
SEC names six blacklisted online trading platforms, warns Nigerians
Meanwhile, Legit.ng has reported that the SEC announced the blacklisting of six online trading platforms.
The move follows the commission's ongoing crackdown on illegal and unregistered online trading platforms purportedly offering vague investment and financial services and products.
The firms include FXBoxed, Axi24, Evolve Consulting LCC, Trust Fund- Mining Global Pty Limited, Prime Invest and Primeinv.co.
The commission stated that the companies that have been blacklisted do not have the legal authorisation to conduct such financial services.
It added that the companies are also not registered by the SEC to operate in Nigeria.
Source: Legit.ng
