Photo 1: MoU signed between SECN and IFSB to solidify closer collaboration
Photo 2: The launch of IFSB’s 2022 Annual Report
Abuja, Nigeria – 6 & 7 December 2023: The Securities and Exchange Commission Nigeria (SECN), in collaboration with the Islamic Financial Services Board (IFSB), hosted the inaugural SECN-IFSB International Forum 2023. This two-day event held at the Abuja Continental Hotel, brought together thought leaders and stakeholders, fostering discussions and collaboration aimed at further deepening the Non-Interest Capital Markets (NICM) in Nigeria.
The first day of the forum commenced with a welcome address delivered by Mr. Lamido Yuguda, Director General of the SECN, setting the stage for insightful conversations and a deep dive into global and regional trends in non-interest capital markets. Mr. Lamido expressed the belief that “Nigeria has the potential to join the leading global Islamic finance jurisdictions when we deal with challenges such as inadequate awareness, regulatory harmonisation, and enactment of legislations that enhance legal certainty and clarity similar to what prevails within the conventional financial architecture”.
Echoing the sentiment, Dr. Bello Lawal Danbatta, Secretary-General of the IFSB, in his keynote address, commended SEC Nigeria, and the Government for their dedication to cultivating a resilient non-interest capital market. “Nigeria’s Non-Interest Capital Market stands as a harmonious testament to financial innovation and progress, seamlessly weaving together the threads of ethical finance and conventional wisdom. The IFSB is honoured to be contributing our efforts, paired with the visionary leadership of the SEC and the Government at this stage that resonates with international regulators, market players, and policymakers – to cultivate a dynamic ecosystem where knowledge blossoms, preferences flourish, and inclusivity thrives.”
In his remarks, Mr. Wale Edun, the Honourable Minister of Finance and Coordinating Minister for the Economy of Nigeria underscored the significance of non-interest capital markets in Nigeria’s economic landscape and the promotion of financial inclusion. The minister highlighted the necessity for alternative financing mechanisms that prioritise equity participation over interest-bearing financing models, emphasising that this approach is crucial for addressing the global debt crisis and fostering swift and
inclusive growth.
Landmark Moments with MoU and IFSB’s Annual Report Debut
A pivotal moment during the forum was the signing of a Memorandum of Understanding (MoU) between SECN and IFSB, solidifying closer collaboration, support, and the exchange of information, research, development, training, and education. The historic agreement outlines a framework for the enhancement of Shariah-compliant non-interest capital markets in the region.
The event also witnessed the launching of IFSB’s Annual Report, developed to provide a comprehensive overview of the international standard-setting organisation’s operations, accomplishments, and progress towards promoting the stability and growth of Islamic finance globally.
In-Depth Discussions on Non-interest Capital Markets
The forum’s discussions delved into crucial market developments and opportunities, with a particular focus on global and regional trends on non-interest capital markets, sustainable green and ESG sukuk, and the role of non-interest capital market instruments in infrastructure financing.
Key recommendations include enhancing Non-Interest Capital Markets (NICM) in Nigeria through measures such as increasing awareness, establishing legal frameworks for infrastructure funding, enacting legislation for Islamic Capital Markets (ICM), providing capacity building for scholars, addressing regulatory bottlenecks, fostering collaboration among stakeholders, and leveraging technology for financial inclusion. The discussions underscore the significance of uniform standards, public awareness,
and targeted strategies to deepen the takaful sector. Moreover, there were recommendations for regular coordination meetings, the establishment of a think-tank, collaboration with academia, capacity building for conventional institutions, and exploration of innovative financing models for infrastructural projects.
The sessions showcased a notable line up of participants, including representatives from institutions such as the Central Bank of Nigeria, AMF-UMOA, NAICOM, Nigeria Deposit Insurance Corporation, Debt Management Office, National Pension Commission, Investment and Securities Tribunal (IST), and Financial Regulation and Advisory Council of Experts (FRACE). Leadership figures from capital market trade groups, operators, industry players, and members of the press also actively contributed to the discussions.
High-level Conversations Around Innovation and Regulatory Approach
As drivers of sustainable and innovative Islamic finance practices, the IFSB conducted the 5th Innovation Forum which saw the convergence of industry players and other stakeholders discussing the latest developments in innovation in Islamic finance. Sessions explored digital innovation, fintech’s role in harnessing shariah-compliant non-interest finance for financial inclusion, and regulatory issues.
Other aspects covered in the session include the integration of digital solutions such as blockchain, AI, and mobile banking in non-interest finance institutions, and conversations around the emerging regulatory landscape in the context of innovative developments of the sector.
The second day closed with the Members and Industry Engagement Session (MIES), fostering interactive communication between IFSB member organisations and financial services industry stakeholders. This session facilitated an open dialogue, providing a deeper understanding of challenges, issues, and
concerns.
Key points raised included the need to tackle supply-side challenges, propose the establishment of a think-tank for non-interest finance with the involvement of regulators and policymakers, and harness technology to boost financial inclusion.
The 1 st SECN-IFSB International Forums served as a platform for robust discussions, collaborations, and the forging of key partnerships, marking a significant milestone in advancing Islamic finance and non- interest capital markets in Nigeria and beyond.
For more information and updates on the IFSB, visit www.ifsb.org.
