The Director General of the Securities and Exchange Commission (SEC), Lamido Yuguda, has stated that the creation of a national savings platform is one of the strategies that would enhance capital formation and spur rapid economic development in Nigeria.
According to him, this could be achieved through mobilisation of domestic funds for investment.
Yuguda, while speaking at the submission of a report of the Working Group on National Savings Scheme held on Tuesday, said the establishment of the scheme would also ensure the provision of risk capital that are naira based and more committed to the long-term prosperity of Nigeria.
He also added that the initiative would serve as a buffer to the instability created by foreign investors.
Yuguda thanked the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed for embracing the initiative and constituting a national working group, while expressing optimism that the minister will accept the recommendations and facilitate adoption of the national savings scheme in the nation’s development program.
“We are indeed grateful for your commitment and efforts to position our market where it deserves to be, a capital market that will broaden access to economic prosperity by enabling the emergence of financially responsible citizens, accelerate wealth creation and wealth distribution, provide capital to small and medium scale enterprises, and catalyse housing finance,” he added.
Earlier, Ahmed stressed that the mobilisation of domestic savings for capital formation and investment is critical for harnessing the growth potential of the Nigerian economy.
The minister said the launch of the Medium-Term National Development Plan 2021-2025 recognises the role of a deep financial market in supporting the nation’s overall growth plan.
“I hope the proposals made in this report will guide the government in taking actionable steps to actualise the objectives outlined.
She assured that the ministry would collaborate with the SEC and other stakeholders to ensure that the country realises the benefits of the scheme.
Ahmed said: “We understand that this initiative will involve several other agencies such as the CBN, FIRS, NAICOM and other important stakeholders. We will leverage on our collaborative working environment within the government to ensure that we get necessary buy-in and commitment from relevant stakeholders.”
While presenting the report, member of the committee and Chief Executive Officer of Foothold Advisors Limited, Dr. Ore Sofekun who presented the report on behalf of the committee chairman, Fola Adeola, said the scheme will be open-ended, adding that participants will have the opportunity to decide how their contributions will be invested and make periodic re-allocations subsequently considering its medium-term to long-term objective
To allow for product diversification and provide savers flexibility and choice, she stated that multiple investor risk/return profiles have been designed with corresponding savings products.
According to her, these products will allow service providers to offer an array of diversified product options tailored to match customer needs.
Sofekun pointed out that a new government-issued savings instrument that has features to protect savers from rising inflation has been recommended and a number of special products have also been proposed with the needs of Nigerians in mind.
On implementation of the roadmap, Sofekun said the scheme will be subject to the overall supervision of the SEC and structured to start as a department within the SEC.