FMDQ Leverages Technology to Enhance Commercial Paper Application Process, Advocates Stakeholder Collaboration

FMDQ Securities Exchange Limited has adopted advanced technology to streamline the application process for Commercial Papers (CPs), a move that underscores its commitment to innovation in the Nigerian capital market. This announcement was made by Mr. Oluwaseun Afolabi, Divisional Head of Market Architecture at FMDQ, during the 2024 Capital Market Correspondents Association of Nigeria (CAMCAN) annual workshop held in Lagos.

The workshop, themed ‘Banks’ Recapitalisation: Bridging the Gap Between Investors and Issuers in the Nigerian Capital Market,’ highlighted key initiatives aimed at fostering efficiency and inclusivity in the market.

Reflecting on the evolution of the CP market, Afolabi noted that the segment had been dormant as recently as 2014 but was revitalized through the introduction of robust frameworks. “Today, FMDQ has deployed technology dedicated to processing CP applications. Stakeholders no longer need to make calls or rely on manual interventions; the system provides instant acknowledgment once an application is submitted via the portal. This platform has significantly enhanced operational efficiency, supporting not just applications but also post-listing compliance and other critical functions,” he said.

Afolabi further highlighted the alignment between FMDQ’s technological advancements and the policies of the Securities and Exchange Commission (SEC), which have enabled seamless bond listings and streamlined processes for fixed-income instruments. “The timing process for applications at FMDQ has been greatly expedited, thanks to SEC’s framework policies,” he added.

On the broader implications of the Central Bank of Nigeria’s banking sector recapitalisation initiative, Afolabi remarked that it would enhance the financial capabilities of banks, enabling them to undertake larger funding programs. “When banks are well-capitalised, they can raise substantial funds—up to N200 billion—thereby benefiting the entire market,” he said.

He also called for increased collaboration among capital market stakeholders to address the persistent issue of information gaps. Effective information sharing, he emphasized, is crucial for resolving shareholder concerns and fostering market transparency.

Afolabi encouraged journalists to play a more proactive role in bridging these gaps by educating the public about the intricacies of the capital market. “Journalists hold a pivotal position in shaping public understanding of market activities. Their efforts can help align investors, issuers, and regulators, driving growth and confidence in the market,” he concluded.

The adoption of technology by FMDQ, alongside its call for stakeholder synergy, marks a significant step towards a more integrated and efficient Nigerian capital market.