The Senate has said the dormant fund in capital market is worrisome, saying enormous wasteful resources in the midst of lack and financial challenges is not proactive.
The Chairman, Senate Committee on Capital Market, Ibikunle Amosun, raised the concern at a stakeholders interactive session at the National Assembly in Abuja.
He also urged the Securities and Exchange Commission (SEC) and the Central Securities Clearing System (CSCS) to address the issue of unclaimed dividends in order to boost investors confidence and growth of the capital market.
“The idle or dormant funds in our system is quite worrisome considering the role those funds can play in the capital Market.
“Any financial system that is characterised with enormous wasteful resources in the midst of lack and financial challenges is not proactive.
“Stakeholders must come up with robust solutions to harness the idle funds and see how it can be channeled into productive ventures,” he said.
Amosun added that the Investments and Securities Act would be reviewed because money market was already dominating the capital market.
“Let me remind us that, the money market is already dominating the capital market due to reasons such as system failure, lack of transparency in operations, insider abuse, etc.
“To this end, the Investments and Securities Act (IST) will be reviewed. We urge all the stakeholders as a matter of urgency to intimate us about all areas that require legislation in order to promote the Capital Market,” he said.
At the event, SEC announced plans to integrate Financial Technology (Fintech) into the Capital Market.
The Director-General of SEC, Lamido Yuguda, said the commission was desirous of implementing the fintech roadmap.
He said, “We are also contextualising the regulatory independent framework to bring on board FINTECH into the capital market.
“We have just released draft rules for the crowdfunding in our regulation. We have received set of comments from the market and very soon we will be releasing these rules to the public.”
Also speaking, the Chairman of Investment and Securities Tribunal (IST), Amos Azi, said cases worth over N800 billion had been determined in the last 13 years.
Azi said that the IST had delivered on its major Key Performance Indicators (KPIs) by delivering judgements within 90 days that is from commencements to judgement day, publication of its law report and sensitization.
He said, “From inception till date, we make bold to say that the IST has adjudicated and determined cases of monetary value of over N800billion in favour of various investors which we believe is very encouraging to investors.
“The investors now know that they have where to approach in case of a dispute.”
He said that the IST had established four zonal offices in Lagos, Enugu, Port Harcourt and Kano in order to bring adjudication closer to investors.
Amosun said that the interface became necessary to devise means of strengthening the capital market.
“This interactive meeting is very apt, especially coming at a time like this when concerted efforts are required to revive our economy, which has been negatively affected due to the outbreak of COVID-19 and the recent EndSars protests.
“We know a lot more can be done, so we urge you to do more especially to introduce new products and consolidate on the existing ones, carry out research on other capital markets across the globe to align with global best practices,” he said.
Amosun urged the stakeholders to work towards domestication of Nigerian products to encourage local investors.
“The capital market needs to re-activate our alternate market, and bring on board unlisted multinational companies, in order to develop a robust Capital Market. These informal sectors, as we are all aware, are a driving force that will dominate our nation’s economy.
“I encourage all the stakeholders present here to strategise on how to encourage Micro, Small and Medium Enterprises (MSMEs), and multinational companies to participate in the Nigerian Capital Market.
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