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‘Offshore Trade Boosted Nigerian Shares in June’

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  • ‘Offshore Trade Boosted Nigerian Shares in June’

Transactions on the country’s stock market rose by 7.13 per cent to N220.27bn ($699.3m) in June from a month earlier, lifted by increased flows from foreign investors, stock exchange data showed on Thursday.

The value of foreign transactions on the local bourse rose by 6.66 per cent to N101.53bn in the period, according to the data.

Nigerian assets, largely shunned by foreign investors over the past three years, are back on their radar thanks to a drop in valuations and improved liquidity.

The equity market has benefited from the introduction more than four months ago of a new window for investors to trade the naira at market-determined exchange rates.

The report showed that foreign investors’ transactions on the local bourse rose by 59.81 per cent to N430.23bn in the first half of this year, compared with N269.22bn a year earlier.

Last week, the market had rallied for eight consecutive weeks and peaked at a 33-month high before profit-takers took advantage of the gains to sell their holdings.

The market’s main index has gained about 34 per cent year-to-date but profit-taking has dominated trading since the start of the week.

“What we have seen is locals riding on the back of foreign investors in the market,” Kemi Akinde, an analyst at Meristem Securities, told Reuters last week.

The gains have extended beyong June, and as of July 14 this year, the Nigerian equities market had attracted N2.715tn investments owing to the foreign exchange window for investors and exporters introduced by the Central Bank of Nigeria on April 21 this year.

Stocks saw huge rallies across board evident in the soaring Nigerian Stock Exchange market capitalisation of listed equities, the All-Share Index, number of deals, as well volumes traded vis-a-vis their values.

The NSE market capitalisation has appreciated by 31.04 per cent between April 20 (last trading day before the window’s opening) and July 14 (latest trading day), from N8.748tn to N11.463tn.

In the same vein, the All-Share Index, volumes traded, deals and value of transactions as of April 20 were 25,282.75 basis points, 147.887 million, 2,578 and N836.842m, respectively.

as of July 14, the respective figures had risen to 33,261.66 basis points, 311.608 million, 3,113 and N3.27bn.

The special forex window tagged, ‘Investors and Exporters FX Window’, according to the apex bank, will boost liquidity in the forex market and ensure timely execution and settlement of eligible transactions.

Small-scale investors and exporters have always decried the closure of several outfits due to lack of access to foreign exchange to procure necessary facilities to support their operations.

The central bank had earlier opened a special window for the Small and Medium Enterprises to facilitate the importation of eligible finished and semi-finished items.

However, the eligible transactions covered under the new window include invisible transactions, such as loan repayments, loan interest payments, dividends/income remittances, capital repatriation, management service fees and consultancy fees.

Also covered by the forex window are software subscription fees, technology transfer agreements, personal home remittances, bills for collection and any other trade-related payment obligations at the instance of the customer.

Other eligible transactions like ‘miscellaneous payments’ detailed under Memorandum 15 of the CBN foreign exchange manual, are also covered under the new window.

Also, transactions and bills for collection are eligible to purchase foreign currencies sourced from the CBN forex window limited to secondary market intervention sales, wholesale (spot and forwards) only.

The only items excluded under the new window are international airlines ticket sales’ remittances, which will only be eligible to access forex at the CBN FX window.

For the apex bank, the supply of dollars to the new window shall be through portfolio investors, exporters, authorised dealers and other parties with foreign currencies to exchange to naira.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

The Africa Digital Inclusion Facility Approves $1.3m Grants for Two Research to Enhance Women’s Digital Access to Loans and Micro-insurance

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The Africa Digital Inclusion Facility approves grants worth $1.3 million for two research efforts to enhance women’s digital access to loans and micro-insurance.

The African Development Bank has approved two grants for research that will increase African women’s access to a range of digital financial services including loans and micro-insurance.

The grants, for $1 million and $300,000 respectively, will be disbursed through the Africa Digital Financial Inclusion Facility, a blended finance vehicle supported by the Bank, to two financial technology firms, Pula Advisors Kenya Ltd., and M-KOPA Kenya Ltd.

Pula Advisors will use the $1 million for research of social, cultural and economic factors that impact women farmers’ access to micro-insurance in Kenya, Nigeria and Zambia. Research findings will inform the design and implementation of gender-centric insurance products. The project will be undertaken over a 3-year time frame.

“This grant funding will be used to leverage technology to develop innovative and responsive loan and insurance products that can spur productivity and inclusion, especially for our women smallholder farmers and traders.” said Sheila Okiro, the Bank’s Coordinator for ADFI.

The three-year project will have three phases: product development; piloting; and scaling; the outcomes are expected to benefit 360,000 farmers, 50% of them women, as well as boost farm yields by up to 30%. This will also raise incomes and enhance household and national food security.

M-KOPA will use the $300,000 grant funding for research involving 250 women and 250 men in Kenya’s Kisumu, Eldoret and Machakos counties. The company will assess the barriers to and opportunities for women’s access to digital financial services and financial literacy programmes via smartphone, and use the research insights to design a financial services app that is relevant to small-scale women traders.

The project, approved by the Bank on 9 February, 2021, will benefit women with no or limited access to financial services that run small informal businesses. Once developed, the mobile app will be used to pilot small loans to the women traders.

Both projects align with ADFI’s digital products and innovation and capacity building intervention pillars as well as its cross-cutting focus on gender inclusion, a thematic running across all its interventions.

The PULA grant approval meets African Development Bank strategic goals, including the Ten-Year Strategy, two High-5 priority areas—feed Africa and improve the quality of life for Africans— and the financial inclusion strategies of Kenya, Nigeria and Zambia.

The M-KOPA project is aligned with the Bank’s Affirmative Finance Action for Women in Africa (AFAWA) program that seeks to increase access to finance for women.

ADFI is a pan-African initiative designed to accelerate digital financial inclusion throughout Africa, with the goal of ensuring that 332 million more Africans, 60% of them women, gain access to the formal economy. The Facility was formally launched in June 2019 at the Bank’s Annual Meetings in Malabo, Equatorial Guinea. Current ADFI partners are the French Development Agency (AFD); the French Treasury’s Ministry of Economy and Finance; The Government of Luxembourg’s Ministry of Finance; the Bill and Melinda Gates Foundation; and the African Development Bank, which also hosts the fund.

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Banking Sector

FirstBank Boosts Cross Border Payment With FirstGlobal Transfer

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FirstBank Boosts Cross Border Payment With FirstGlobal Transfer

First Bank of Nigeria Limited has announced the launch of First Global Transfer (FGT) to promote the international transfer of funds across its subsidiaries in sub-Saharan Africa.

The bank, in a statement, said: “First Global Transfer (FGT) initiative is specifically designed to ensure safe, timely and improved efficiency in the transfer of funds across the network of FirstBank subsidiaries in Africa.

“The FGT is not restricted to FirstBank and FBNBank customers alone but it is also open to every individual resident in the country the funds’ transfer is originating from.

“Intending users of the initiative are to visit any of the bank’s branches in Nigeria or subsidiaries in Africa, which are: FBNBank DRC, FBNBank Ghana, FBNBank Gambia, FBNBank Guinea, FBNBank Sierra-Leone, or FBNBank Senegal to enjoy the service.

“For example, with First Global Transfer, individuals and customers in Sierra-Leone can walk into any FBNBank branch to send money to FirstBank customers in Nigeria as well as FBNBank customers in Gambia, Ghana, DR Congo, Senegal or Guinea.”

Speaking on the initiative, Dr. Adesola Adeduntan, Chief Executive Officer, FirstBank said, “today’s customer is influenced by the technological advancement shaping businesses across various industries and our First Global Transfer (FGT) initiative is one of those advancement created to impact every individual in our host community in Africa, whilst promoting the ease and swift transfer of money from one country to another for business or personal activities.”

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Finance

Ecobank To Pay Customers N5 For Every Dollar Received

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Ecobank To Pay Customers N5 For Every Dollar Received

Ecobank has implemented the CBN scheme which offers N5 for every Dollar received into domiciliary accounts or as cash over the counter. Korede Demola-Adeniyi; Head, of Consumer Banking, Ecobank Nigeria, who announced this in Lagos stated that the decision is in line with the CBN directive and fully aligns with efforts to encourage the inflow of diaspora remittances into the country.

She noted that the “CBN Naira 4 dollar scheme” is an unprecedented incentive for senders and recipients of international money transfers.

Korede Demola-Adeniyi said that the scheme takes effect from 8th March and will run till 8th May 2021. “Ecobank will pay N5 on every Dollar so beneficiaries will not only get the foreign currency sent from their family and friends abroad, but they will also get extra Naira”, she stated.

Only recently, Ecobank had a first-of-its-kind virtual Diaspora Summit to discuss opportunities for Nigerians living abroad and the various platforms available to assist them with their investment decisions and remittance needs. The event had major players in the remittance space, diaspora audience, government officials and notable stakeholders in attendance.

Further, the Managing Director, Ecobank Nigeria, Patrick Akinwuntan has disclosed that apart from consistent engagement with Nigerians in the diaspora, Ecobank is leveraging its digital technology to make remittances to Nigeria and Africa easy, convenient and affordable.

Mr. Akinwuntan stated that growing evidence has shown a positive relationship between diaspora remittances and economic growth.

“Ecobank will continue to pursue its mandate of helping to enhance the economic development and integration of Africa, through the 33 countries where the bank operates on the continent. Ecobank’s Rapidtransfer and mobile app (Ecobank Mobile) enable Africans, wherever they are, to easily and instantly send money to bank accounts, mobile wallets and agent locations across 33 African countries”, he stated.

Ecobank Nigeria, a member of the Pan African Banking Group is committed to supporting Africans in the diaspora by providing advisory services, remittance solutions, investment options and financial planning schemes. The bank also offers mortgages, treasury bills, capital market instruments, among others.

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