SEC, SMEDAN Partner to Boost SME Capital Market Access
By Patience Ikpeme
The Securities and Exchange Commission (SEC) is set to collaborate with the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) to conduct joint nationwide sensitization campaigns focused on “Financing SMEs through the Capital Market.”
Director General of the SEC, Dr. Emomotimi Agama, announced this initiative during a meeting with SMEDAN representatives in Abuja on Tuesday. He stated that the two agencies will also jointly develop financial literacy content and SME investment-readiness toolkits.
Dr. Agama explained that the purpose of the meeting was to initiate a strategic partnership between the SEC and SMEDAN to facilitate access to capital market funding for small businesses.
He noted that this engagement aligns with the mandate of the SEC’s newly established Office of Small Business Advocacy (OSBA), which was created to serve as the primary point of contact between the SEC and SMEs seeking to raise capital through the issuance of securities.
According to Dr. Agama, “SMEs represent over 90% of businesses in Nigeria and contribute significantly to employment and GDP. Despite their importance, most SMEs face significant barriers in accessing long-term, affordable financing. SEC, through the OSBA, is actively working to broaden access to market-based financing instruments for SMEs.
“SMEDAN is a statutory stakeholder in the MSME space with deep knowledge, nationwide networks, and relevant data infrastructure to support SME development, and a collaborative framework between SEC and SMEDAN will foster synergies for policy innovation, capacity building, and SME investment readiness.”
The SEC DG disclosed the Commission’s intention to formalize a partnership with SMEDAN to implement coordinated interventions in several key areas. These include Data Sharing through secure access to reliable and verified SME data to enable capital market outreach and segmentation, and the joint use of SME analytics for market readiness assessments and policy insights.
Dr. Agama further stated, “We also hope to design and deliver training programs for SMEs on capital market funding opportunities, governance, and compliance, as well as co-host a National SME Capital Market Summit in Q3 or Q4 to showcase financing opportunities for SMEs.”
Dr. Agama conveyed the necessity of leveraging Nigeria’s entrepreneurial potential through inclusive capital formation, asserting that “There will be no economy without the capital market. The capital market is the engine room of any economy, and the reason companies are not approaching the market is due to lack of funds, so we are here to change the narrative because we are aware that SMEs are the backbone of our economy. By working with SMEDAN, we can create enabling frameworks that will help these businesses access long-term funding from the capital market.”
Executive Commissioner, Legal and Enforcement at the SEC, Ms. Frana Chukwuogor, added that the new finance act and SEC regulations now enable owners of small businesses to raise funds from the capital market through both equity and debt instruments to facilitate growth, noting the capital market’s potential to provide the necessary financial impetus for their businesses.
In his response, the Director-General of SMEDAN, Mr. Charles Odii, welcomed the collaboration, describing the partnership as a potential game-changer for Nigeria’s SME landscape.
“This alliance with the SEC aligns perfectly with our mandate to upscale and formalize the informal sector. By introducing SMEs to non-traditional funding avenues like bonds, equities, crowdfunding, and other market instruments, we can empower more businesses to scale sustainably,” Mr. Odii stated.
The meeting concluded with a mutual agreement to establish a national working team. This team will be responsible for streamlining the onboarding processes for SMEs seeking to participate in the capital market, developing targeted investor education programs tailored for small businesses, and creating innovative financing models designed to meet the specific needs of SMEs.
