The Fund Managers Association of Nigeria (FMAN) says it is partnering with the Securities and Exchange Commission (SEC) on electronic transfer of funds to boost financial inclusion and investment in the nation’s bourse.
The president of the association, Dr Ore Sofekun, stated this at the annual workshop of the Capital Market Correspondents Association of Nigeria (CAMCAN) on Sunday in Badagry, Lagos.
Sofekun said that electronic transfer of funds would enhance confidence building between investors and fund managers as well as encourage more savings for investment purpose.
Speaking on the topic, “Deepening Retail Investors’ Participation in the Capital Market’’, she said increased savings would accelerate economic growth and development.
Sofekun said Nigeria needed to develop long-term savings culture to achieve the desired growth.
Sofekun, who is also the Managing Director of Investment One Venture Capital, recalled that in 2008, the number of domestic investors who invested in the money market funds was higher than foreign investors.
She said foreign investors took over the market when the economy was down and went away with their dollars.
“In United Kingdom, average investors save their money for six to seven years from the day a child is born.
Parents begin to save for his or her university education as both primary and secondary school education is free,’’ she said.
Sofekun said that government should introduce the right incentives for people to be encouraged to save for long-term.
She called for the introduction of more investment products to enhance retail investors’ participation in the market.
Sofekun stressed the need for financial literacy, adding that many investors in 2008 invested in things they did not understand.
Mr Adeniyi Adebisi, the National Coordinator-elect of Independent Shareholders Association of Nigeria (ISAN), said market capitalisation of equities on the Nigerian Stock Exchange (NSE) had shrunk from N14 trillion to N8.6 trillion.
According to him, government needs to ensure return of confidence in the capital market.
“Confidence of the investors, especially retail shareholders, have been jolted and severely shaken.
It will require a great deal of efforts on the part of government at the highest level of authority to bring back the confidence.
Essentially, investment is saving and not gambling. From this perspective, many investors who had their fingers badly burnt might have acted from not too altruistic motives,’’ he said.
Adebisi said massive education of the investors should be embarked upon by all the stakeholders in the capital market to return investors’ confidence.
He called on market regulators to minimise sanctions and fines imposed on quoted companies.
According to him, massive fines and sanctions are discouraging companies to seek a quotation on the exchange.