How Information Technology Has Transformed the Operations of the Nigerian Stock Exchange

The Nigerian stock exchange NSE, also known as theintermediary to all transactions thereby providing a fair
Nigerian capital market has experienced a very robusttrading system for all investors. However, the NSE
growth in the last decade, in terms of activities,invested heavily in launching the Automatic Trading
transaction types, volume and value of trade, numberSystem (ATS). This system allows for automation of
of listed companies and number of capital marketthe capital market operations. As a result of this
operators. It has also witnessed a growinginitiative, the transaction period was drastically reduced
governmental presence in the area of bond issuancefrom an average of three months or more to a trading
to finance development projects. The stock exchangeday plus three other working days.
is one of the most profitable ventures for wealthAfter the automation of the stock exchange floor, the
creation in Nigeria today. However, this was not theSecurities Exchange Commission launched the
case in the previous decades when it was a case ofimplementation of the e-bonus, e-dividend, e-allotment
delayed transactions coupled with bureaucratic modesand e-IPO.
of operations that had to be tolerated by NigerianThe emergence of GSM operators did not only ease
investors.communication and provided job opportunities, it also
Information technology can be said to be the Messiahhad a great effect on the markets credibility, in the
of the NSE because it has helped to curb a lot ofyear 2006, a phone based alert program was
fraudulent schemes from dubious stock brokeragesintroduced. This in turn increased the investors trust in
and issuing houses as well as providing a transparentthe Nigerian capital market transactions.
and more efficient mode of operation for this goldThe impact of Information Technology on the capital
mining sector. This Messianic effect can be seen frommarket would not be complete without a mention of
the changes that have occurred in the recent past.the internet boom as communication with stockbrokers
First, it was the introduction of the Central Securitiesand shareholders have improved so also information
Clearing System (CSCS). This is a subsidiary of thelike market capitalization, all share index, value and
NSE that monitors the activities of the exchange in avolume of stock traded, bulls and bears, are all
computer based environment by serving as anavailable.