SEC Aims for 50 Shari’ah-Compliant Listings Worth N5 Trillion by 2025

The Securities and Exchange Commission (SEC) reaffirmed its commitment to achieving a target of 50 listings of Shari’ah-compliant products, with a combined market capitalization estimated at around N5 trillion by 2025.

Mr. Lamido Yuguda, the Director-General of SEC, represented by Mr. Dayo Obisan, the Executive Commissioner of Operations, made this announcement during a capacity-building workshop for local Shariah talent within the non-interest capital market – level II.

The event, held in Abuja, was organized in line with the non-interest capital market (NICM) segment of the revised Capital Market Masterplan (2021 – 2025), which aims to introduce 100 retail Shariah-compliant products and attract over one million direct investors in Shariah-compliant products.

Yuguda explained that in the face of these ambitious targets, the commission is resolved to intensify its developmental efforts, particularly in capacity building.

This initiative aims to nurture competent professionals who can leverage Shariah best practices to facilitate the effective implementation of Shariah-compliant initiatives, ultimately fostering the growth of the NICM sector.

The Director-General noted that the commission would continue to utilize its subsidiary, the Nigerian Capital Market Institute, to develop robust programs related to Non-Interest Finance. These programs are expected to promote capacity-building and enhance the adoption of Shariah-compliant products and processes.

Yuguda highlighted the fundamental distinction between conventional finance and Non-Interest Finance, emphasizing the application of Shariah principles in the latter. He stated, “NICM cannot exist without experts in Islamic commercial jurisprudence (Fiqhul Mu’amalat Al-Maliyya).”

“The objective of this Workshop, therefore, is fast-tracking the development of experts for the Market,” he continued. “We believe this will enhance the development of our local Sharia talent, not only for the Nigerian Capital Market but also for the Nigerian Financial system in general.”

Yuguda underscored the growing interest in NICM products among various investor classes in Nigeria, citing the oversubscription of the FGN and corporate Sukuk issued in previous years as evidence.

He noted that the Level 2 segment of the workshop, which commenced with extensive discussions on Shariah Contracts, is aimed at consolidating participants’ understanding of both theoretical and practical aspects of NICM.

“Armed with this training and subsequent ones to come, the participants would undoubtedly have the potential to provide Shariah advisory services for the Islamic Finance Industry, particularly the Non-Interest Capital Market’s operations as it relates to Shariah principles and rulings,” he added.

Yuguda also highlighted the significant progress made in this area, with Nigerian Islamic Finance ranking 13th on the Global Islamic Finance Development Indicator 2022, surpassing countries like Bangladesh and Turkey.

He concluded by emphasizing the gradual growth of the Non-Interest Finance Sector, which has evolved into a distinct industry within the broader financial landscape. This sector offers viable alternatives to traditional interest-based financial systems.