From 2018, technology start-ups have pioneered major disruptions of the financial space in Nigeria. These disruptions have been lauded by Nigerians, particularly at a time when there has been a persistent devaluation of the Naira. Savvy and upwardly mobile Nigerians have then opted to use these technology platforms, to save in foreign currencies and also purchase foreign stocks that are being offered. Some of these technology investment platforms include Trove, RiseVest, Chaka and Bamboo etc. They typically partner with CMOs in Nigeria for their expertise and already-procured brokerage licence.
As a background, recall that in December 2019, the SEC had published a statement to notify the Nigerian public of its interim orders to restrain an investment platform called Chaka Technologies Limited (“Chaka”). This order came about as a result of the advertisement and sale of foreign securities of companies such as Google, Alibaba, Facebook, Tesla etc. in Nigeria by Chaka. The SEC had informed the Investment Securities Tribunal (“IST”) that Chaka had offered securities for sale “outside the regulatory purview of the Commission and without requisite registration as stipulated by the Investment and Securities Act (“ISA”).
Chaka responded to the allegations above by releasing a press statement, denying the wrongdoing entirely. However, in March, Chaka announced that it had obtained a newly created licence from the SEC which allows it to offer the services above i.e. advertising and sale of foreign securities to the Nigerian public.