SecZim challenges capital market innovators

BUSINESS REPORTER

The Securities and Exchange Commission of Zimbabwe (SecZim), the body responsible for regulating Zimbabwe’s capital markets, has challenged the industry’s creative thinkers to develop new strategies for promoting inclusive growth for both large corporations and micro, small to medium-sized enterprises (MSMEs).

In order to create an empowered and prosperous upper middle-income society in Zimbabwe, SecZim chairman Yona Banda said it was critical to create a new transformative and inclusive development agenda.

“It is my hope that capital market innovators contribute to the National Development Strategy 1 (NDS1)   objectives through promoting and sustaining inclusive and equitable growth, promoting new businesses, employment and job creation and modernizing the market through taking advantage of ongoing technological advancements,” Banda said.

NDS1, a government of Zimbabwe economic blueprint, covers the years 2021–2025.

In order to achieve the overall objective of sustainable economic growth, according to Banda, production and productivity in key sectors are essential.

The MSME sector, Banda said, serves as a base for private sector-led growth in support of Zimbabwe’s transformative inclusive economic growth agenda.

However, the MSMEs “have ordinarily remained at the margins of the economy with lack of capital for business expansion, lack of information to properly price their products and services”.

“(They)  are often excluded in a wide range of financing options and most markets are often inaccessible. Yet, capital markets are known to provide long term capital for long term growth,” Banda said.

He said innovators should  make the capital market accessible to the marginalised and should be able to provide them with the necessary information they need to make informed business decisions.

Banda said innovations should promote transparency particularly in pricing mechanisms of farmers in remote parts of the country and in the fight against money laundering.

Since equities have long dominated the market, Banda  said innovative  ideas expand the variety of investment products and services that are offered on the market.

According to him, innovators must balance investor protection with new ideas because markets only exist thanks to investors and without them there would be no capital markets.

In order to realize the goals of the government’s Vision 2030, Banda  urged all securities market intermediaries and capital market participants in general to collaborate through this initiative.

“We may not know much about these upcoming technological developments. However, it is always the first step that counts. We will not be doing justice to our market by shunning these new ideas,” Banda said.

The government has pledged to support the growth of Zimbabwe’s capital market.

Given the evolving operating environment, Banda urged the market to embrace fintech.

“It’s either we adapt as a market, or we face the wrath of risks often associated with unregulated markets. It is my hope that stakeholders will collectively work together in enlightening the Treasury with clear and focused policy advice towards the development of an enabling regulatory framework for capital market related innovations.

“In turn, the government will ensure that this initiative is well supported and nurtured.

“I hear some of our regional peers have since moved on, let us learn from our fellow markets who are leading in this space. Let us work together so we can put our ideas to action for the growth of the Zimbabwe capital market and economy at large,” Banda said adding the doors to SecZim would remain open for all new capital market related innovations in order to promote the breadth and depth of the market.