Fintech startup Chaka has received a new license for digital stock trading in Nigeria from the Securities and Exchange Commission (SEC). This makes Chaka the first recipient of this newly created license by the SEC, as part of the Commission’s efforts at fostering regulation within the technology-based business environment. The licensing is designed to ensure the safety of the investing public while encouraging innovation.
Speaking on the new license Tosin Osibodu, Co-founder & CEO, Chaka Technologies stated that, the license will help the platform to thrive and achieve its target to enable digital investing for businesses and individuals in Nigeria and Africa.
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“We are proud to be the first fintech company to receive the SEC license in Nigeria, the Digital Sub-Broker license. For us, this is an important step towards achieving our vision to level the playing field for African investors and create a defining moment for the future of digital investments in Nigeria, and Africa at large. Receiving this new license will enable us to continue to power on our mission to enable digital investing for businesses and individuals in the country and beyond.”
He also noted that the new license is coming at the right time as Nigeria is currently the epicenter of fintech innovativeness and that the milestone license will help protect the investing public.
“As Nigeria becomes a beehive of fintech innovativeness, this new license is the much-needed guide to help safeguard the investing public in the evolving landscape. The SEC license represents a notable milestone for all players within the industry, and we are confident that it would strengthen efforts towards fostering further growth and transformation. We are happy to set this precedent and are excited for the long-term impact of this new regulation and what it signals for the future. We are also thankful for the continued trust of our investors and partners, as we remain committed to fulfilling their needs.”, said Osibodu.
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On the 19th of December 2020, the SEC published a statement that effectively barred Chaka from offering its services in Nigeria. SEC’s complaint was that Chaka operated “outside the regulatory purview of the Commission and without requisite registration, as stipulated by the Investment and Securities Act 2007.”
SEC ordered Chaka to stop advertising to users, justifying it as a need to prevent “unscrupulous actors” from harming the investing public. Though the order was particular to Chaka, it was the first major signal that regulation was coming to the investment-tech sector.
What You Need to Know About Chaka
Founded in 2019 by Tosin Osibodu and Olaolu Ajose, Chaka enables every business and person in Africa to access borderless digital investment and wealth management opportunities. The platform offers over 4,000 stocks from publicly traded companies in Nigeria and the US.