The role of the SEC and the Stock Exchange in small-scale financial businesses in Nigeria

By Temo name  

Published: September 10, 2026

The purpose the Nigerian stock exchange services is to create a medium where you can take disposable income to basical purchase products you believe would improve in value at letter date in financing small scale business the stock exchange pays the role of mobilization of private and public service servings for investment through trading in shares and stock to service as a broad communication and not for it constituencies and they row of overseeing the market and their member sin participant or one head and safe regulating itself on the other hand they also ensure fair dealing in security through it row regulation and operation now goods which have to protect the public form hands issues ability to raise capital in the primary market and understanding the importance of Capital Management and also serve as a forum or magnesium for the implementation of the indeed indignation program this security and exchange commission sec has a role to protect investors especially in this context the small scale business and to maintain fair or delay and effective market with a view of facilitating capital format second shows that companies offering security for sale to the small scale business or the public must tell this truth about their business the security they are selling and they risk involved in investing in this securityities and also those who say and trade security is brokers dealers and exchange must treat investors fairly and honestly functions of Stock Exchange and security and exchange commission as a source of financing business Enterprise entrepreneurship sake is a government agency established by statute to administer security laws. Such laws usually empower these agents to regulate the capital market, with the primary goal of protecting investors in some countries' markets, like Nigeria. Development is added to their function, and financing entrepreneur business is the face of the regulatory body. Without some group of people, they would take all our hairs and money from our account and tell us our account is missing.

I didn't anticipate that when I began my writing and research career, I would have to write about capital markets and small businesses. But I am here and I am happy to be here. It's because small businesses are the drivers of Nigeria's economy and I think every Nigerian should know the activities of the Securities and Exchange Commission (SEC) and the Nigerian Exchange (NGX) with respect to the small businesses.

Why Small Businesses Matter

I'll begin with the figures. PwC's MSME Survey for 2024 indicated that Nigerian businesses are dominated by small and medium enterprises, which make up 96.9 per cent of businesses, 87.9 per cent of employment and 46.32 per cent of GDP. From the figures, I can only understand that if it is the small businesses we are talking about, it is the heartbeat of the Nigerian economy.

The Federal Government has also acknowledged this. The government has promised it will support the informal sector which accounts for more than 50 per cent of Nigeria's GDP in 2024. I am happy to see this, because it is an indication that policymakers are listening to the businesses that affect the everyday life of Nigerians.

The SEC and its Mission

The Securities and Exchange Commission (SEC) is the top capital market watchdog in Nigeria. I have learned to value the work that the SEC does towards providing an enabling environment so that businesses of all sizes can obtain capital.

The SEC created the Office of Small Business Advocacy (OSBA) in 2025 as its main point of contact with SMEs who wish to finance their operations through securities offering. I believe it's a terrific plan since it indicates that the SEC is aware that small enterprises need specific assistance to maneuver the capital marketplace.

The Director-General of the SEC, Dr. Emomotimi Agama, has been adamant in his advocacy for expanding the use of market-based financing tools for SMEs. He said that most of the SMEs are hampered from securing long-term financing at affordable rate of interest. I couldn't agree with you more.

The Stock Exchange and SME Listings

The Nigerian Exchange Group has been working round the clock to make small businesses a part of the capital market. I have been very impressed at how they have progressed and the initiatives they have taken.

The NGX Growth Board was built with the purpose of allowing SMEs to obtain long-term funding. The NGX is working to educate SMEs about the capital market and how they can use it to scale their businesses sustainably and through the workshops and advocacy programs.

NGX CEO, Jude Chiemeka, highlighted the pivotal role played by SMEs in enhancing market depth and resilience. I can only conclude from this that the exchange recognizes the significance of small businesses to the market.

The SEC-SMEDAN Partnership

The collaboration between the SEC and Small and medium enterprises development agency of Nigeria (SMEDAN) has been one of the most remarkable changes I have seen. Both agencies signed an MOU in October 2025 for better access to long term financing for more than 40 million registered MSMEs in the form of an MOU.

Dr. Agama said that capital is the "bedrock" of any company, and that it is imperative to look for avenues to raise capital for sustainability for SMEs. Charles Odii, the Director-General of SMEDAN, said anyone wishing to do any medium scale business in Nigeria has to have "very expensive and scarce" capital, adding that this partnership is another source of funding for medium scale businesses.

It is my great pleasure to see the target of listing at least 1000 SMEs on the capital market. This will spur Nigeria's development, generate wealth and alleviate unemployment.

Things I've noticed as a challenge

I'm hopeful about these things, but I'm aware of the difficulties. SMEDAN's Director-General has noted that small businesses don't have sufficient access to funding. He revealed that of a N600 million fund available for small businesses, only about 12 entrepreneurs were able to access it.

This is an indication to me that capacity building is as much as access to capital. The SEC and SMEDAN are tackling this through financial literacy, governance and capital market engagement training programs.

The Path Forward

I think the small financial businesses in Nigeria have a bright future ahead. According to the SEC's Nigerian Capital Market Master Plan, the following are identified as key priorities: Market deepening, Financial inclusion, Technology, Investor education and New products. These are the right priorities.

The collaboration between the NGX and the Bank of Industry is also establishing avenues for SMEs to avail themselves of alternative financing methods and making some preparations for the day of listing.

To small businessmen reading this, I wish to assure you that the capital market is not reserved for big corporations. The SEC and the stock exchange are on the case to provide opportunities for businesses like yours. The path can be challenging, but it's possible with the right assistance and guidance.

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Sources:

- Nigerian Exchange Group (ngxgroup.com)

- Securities and Exchange Commission Nigeria (sec.gov.ng)

- Small and Medium Enterprises Development Agency of Nigeria (smedan.gov.ng)

- PwC Nigeria (pwc.com/ng)

- Punch Newspapers (punchng.com)

- The Guardian Nigeria (guardian.ng)

- BusinessDay Nigeria (businessday.ng)

- The Cable (thecable.ng)

- Radio Nigeria Lagos (radionigerialagos.gov.ng)