Sam Onukwue, chairman of the Association of Securities Dealing Houses of Nigeria (ASHON) is also a Fellow of Chartered Institute of Stockbrokers (CIS). He discusses the current state of Nigerian capital market, critical role of licensed stockbrokers, and what must be done to deepen investor participation in a challenging economic environment, writes Iheanyi Nwachukwu. Excerpts
How would you describe the current state of Nigeria’s capital market?
The Nigerian capital market is gradually recovering from past shocks and is showing signs of greater resilience. We’ve seen improvements in investor confidence, stronger regulatory oversight, and the adoption of advanced technologies. The ongoing effort by the Central Securities Clearing System (CSCS) to reduce the settlement cycle to T+2 settlement and subsequently to T+1 will further impact positively on the market. These are positive indicators. However, challenges remain. Inflation continues to erode returns, foreign exchange volatility affects investor sentiment, and retail participation is still relatively low. While the market is more stable than in previous years, there is still significant room for deeper market penetration, improved investor education, and stronger protection mechanisms.
What recent developments have been most encouraging?
Several developments are worth highlighting. First, the transition to a T+2 settlement cycle aligns Nigeria with global best practices, boosting our credibility among international investors. The adoption of digital onboarding and fintech integration has also made the market more accessible, especially for younger and tech-savvy Nigerians. Moreover, we’re seeing a rise in tech-driven brokerage platforms that provide real-time trading and investment tracking. Importantly, the Securities and Exchange Commission (SEC) has improved regulatory transparency, which is critical for building long-term investor trust.
Why do you think retail investor participation remains low despite these improvements?
The main issue is the persistent trust gap. Many Nigerians are still skeptical of the market, partly due to past experiences during market downturns and the prevalence of fraudulent schemes at that time. The market has since moved from that era though. There’s also a general lack of financial education. A large segment of the population don’t understand how the capital market works, or how to invest safely and sustainably. We believe this can be changed through increased awareness, better investor education, and by promoting the value of working with licensed stockbrokers.
What role do stockbrokers play in protecting investors from risk?
Stockbrokers are the first line of defense for investors. As licensed professionals regulated by the SEC, we help clients make informed decisions. Our responsibility is not just to execute trades but to provide advisory services, perform due diligence, assess risk, and ensure regulatory compliance. We guide investors away from speculative ventures, Ponzi schemes, and misleading financial advice. In essence, a stockbroker’s role is both protective and educational. We act in the best interest of our clients.
In the digital age, many investors use apps directly. Do traditional stockbrokers still matter?
Absolutely. Technology enhances access, but it cannot replace expertise. Investment apps may allow users to buy and sell, but they rarely provide personalized advice tailored to the investor’s financial goals, risk appetite, or long-term strategy. Licensed stockbrokers are trained to offer sound financial advice, interpret market trends, and recommend diversified portfolios. Given the increasing number of online scams and misinformation, the role of regulated, professional intermediaries is more crucial than ever.
How would you advise a first time investor?
Start with a licensed stockbroker who is regulated by the SEC and licensed by the Nigerian Exchange (NGX). Learn the fundamentals of investing, understand the risks and the potential returns. Focus on diversification, avoid emotional trading, and stay away from get-rich-quick schemes. Think long-term. The capital market rewards patience and consistency. And always verify investment opportunities through official channels. A credible stockbroker will guide you through this process.
What government policies would help deepen investor participation in the capital market?
We recommend several interventions. First, tax incentives for listed companies that pay consistent dividends could attract more retail and institutional investors. We strongly recommend that Government should reconsider its stance on Capital Gains Tax on as it affects capital market transactions. Government should also promote financial literacy at all levels, starting from schools and include capital market education in national curricula. Equally important is macroeconomic stability. A stable foreign exchange regime, lower inflation, and consistent policy implementation will significantly enhance investor confidence, both local and foreign.
How can the government make investing more appealing to the average Nigerian?
Government can issue more retail-targeted savings bonds or tax-free instruments tied to the capital market. Additionally, digitizing privatization programs through the NGX will allow ordinary Nigerians to own shares in government enterprises. This will drive inclusion and increase the sense of ownership in national assets. When people see tangible value in equity participation, especially if simplified and digitised, they are more likely to invest.
Is ASHON working with regulators to implement these reforms?
Yes, ASHON maintains a collaborative relationship with key regulators such as the SEC, the Nigerian Exchange (NGX), and the CSCS. We have regular engagements and consultations aimed at improving investor protection, boosting investor confidence and encouraging innovation. We also advocate for the introduction of user-friendly investment platforms and support policy shifts that promote a transparent, inclusive, and growth-oriented market.
How is ASHON as a Trade Group helping its members remain competitive in a rapidly evolving market?
We provide regular training, workshops, and digital literacy sessions to ensure our members are up to date with the latest trends and compliance requirements. Many of our member firms are embracing fintech innovations like robo-advisory tools, AI-powered analytics, and mobile trading apps. Our goal is to transform stockbrokers from traditional intermediaries into technology-driven financial advisors who can serve both retail and institutional clients effectively.
What needs to be done to regain the confidence of foreign investors?
Foreign investors prioritise stability, liquidity, policy consistency and sanctity of contract. Government must ensure a more predictable foreign exchange regime and address concerns around capital repatriation. A transparent market driven approach to privatisation will enthrone sound corporate governance in privatised entities and make our market more attractive to foreign investors.
What is your message to Nigerian investors—especially in this period of economic uncertainty?
Now more than ever, Nigerians need to take control of their financial future. The capital market offers an avenue for wealth creation, passive income, and financial independence. But success comes from informed and patient investing. My message is simple: work with licensed stockbrokers, avoid shortcuts, diversify your investments, and stay informed. The Nigerian capital market is growing, and you deserve to grow with it. By promoting professionalism, transparency, and innovation, ASHON and its members will continue to play a central role in building a more inclusive and investor-friendly capital market.