The Nigerian Exchange Limited (NGX) has revealed its partnership with the Central Securities Clearing System (CSCS) Plc and Euroclear to establish a dollar settlement platform that will facilitate tech startups’ fundraising in dollars.
This platform aims to provide opportunities for domestic investors to access tech startup shares, fostering capital democratization and contributing to Nigeria’s economic growth.
Speaking at the Annual A&O Fintech webinar, Jude Chiemeka, Divisional Head of Capital Markets at NGX, noted that while public markets are viable for capital raising, fintechs often prefer private markets due to regulatory disclosure and governance requirements for public listing.
To address this, NGX obtained Securities and Exchange Commission (SEC) approval to launch a technology board that will enable fintechs and tech firms to raise capital in local currency, potentially offsetting challenges posed by high-interest rate environments that deter foreign investors.
Opinion: The collaboration between NGX, CSCS Plc, and Euroclear to establish a dollar settlement platform for tech startups signifies a proactive approach to address the challenges fintechs face in accessing capital in foreign currencies. This initiative, along with the technology board for raising capital, showcases the commitment of Nigerian financial institutions to promote local innovation and investment. This move aligns with efforts to support domestic investors and stimulate Nigeria’s economic growth through innovative capital solutions.