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By Chinwendu Obienyi
As part of its responsibility to protect investors and their investments in the capital market, the Securities and Exchange Commission (SEC) has stated that it will roll out its regulatory incubation programme for fintechs.
The Director, Exchanges, Market Infrastructure and Innovation, Abdulkadir Abbas stated this during an interview with Daily Sun.
Abbas stated that the regulatory incubation program is a program that is designed as an interim measure to actually facilitate genuine regulation of Fintechs activities that will conform to the capital market issues.
He said the idea of coming up with this program, which is like a sandbox, is to be able to come and test innovative ideas as stated in the SEC guidelines adding that the incubation period would be open for one year.
According to Abbas, “It is just for testing, it will not be approved at that stage but all Fintech ideas that conforms with investment activities are defined in Investment and Securities Act 2007 can be tested under that kind of program. As we informed the market, there is going to be an initial assessment before it can be on-boarded into the regulatory incubation program.
The SEC Director said the Commission, through the RI, is providing an avenue where fintechs can test their ideas without affecting the market integrity, adding that one of the other objectives is to be able to create an opportunity to solve an existing problem in the market.
Abbas stated that the takeoff has been very encouraging with the SEC gaining traction with market participants showing more interest and have commenced the first stage which is the initial fintech assessment route.
He disclosed that before the take-off of the RI, the SEC has been engaging with various fintech applicants some of whom are existing capital market operators.
He said, “Some are existing market operators; some are actually new interests into the market so we have been having this kind of engagement and so from the time when we announced the takeoff till today, what has been happening is that a lot of applicants are actually accessing what we call the initial assessment form so there is a need which we can now be able to provide the initial information and that is the first stage of on boarding you into the RI, that is where we are now. We have had a couple of engagements and what interests us really is the traction of new fintech companies providing a solution to an existing problem in the market”.
According to him, what the SEC is trying to do now very quickly is to encourage more of these fintechs to come now that we have opened this phase.
“We believe that it will really deepen the market and it will facilitate bringing new products into the market and new ideas will come on board towards the solution of existing problems in the market. As I said earlier, the principal plan is to actually provide an avenue of new solutions without compromising on investor protection which is our own key objective”, Abbas said.
