Olisa Agbakoba Legal (OAL) has advised the Securities and Exchange Commission (SEC) to promote legal and regulatory framework for crowdfunding to thrive in Nigeria.
Mrs Olabisi Akodu, Partner, Corporate and Public Sector Group at OAL, said the time was apt for review of all legal and regulatory frameworks required to invigorate the capital market and financial sector services. Akodu gave this advice during a chat with newsmen in Lagos at the weekend.
Crowdfunding is a process of raising fund for a project or business venture through many donors using online platform. Equity Crowdfunding allows people to invest in an early stage of unlisted company in exchange for shares in that company.
According to her, equity crowdfunding if properly legislated and regulated can serve as finance option for the teeming small businesses. “It would also provide a new security class and deepen our capital market where such securities are listed on the capital market.
Nigeria has seen a tremendous rise in the use of online platforms; we have seen the success of online shopping portals and more recently online gambling. Although Crowdfunding has not taken deep root in Nigeria, there is a certainty that it will. When it does, we must ensure that we have the enabling legal and regulatory framework to support this massive innovation. There are about 1000 crowdfunding portals worldwide supporting a multi-billion dollar industry.
Global crowdfunding experienced accelerated growth in 2014 to reach 16.2 billion dollars in the United States, while the industry raised over 34.4 billion dollars in 2015.
Culled from sundiatapost.