Ever since December 2020 when Nigeria's Securities and Exchange Commission (SEC) dished out a new set of rules for investment-tech startups operating in the country, Chaka has been in regulatory crosshairs.
One of the startups trying to democratize retail investments by locals in foreign stock markets, Chaka has seemingly been the ground zero for the changes in the rules governing investment-tech in the country, as dictated by the SEC.
Investment-tech startups like Chaka, Bamboo, Trove, and others are part of an emerging class of fintechs that enable the average person to trade stocks of some of the world's biggest companies listed in foreign stock markets.
These startups typically have arrangements with duly-licensed Capital Market Operators (CMOs) or brokers which allows them to use their digital platforms as a means through which retail investors can access investments in foreign stocks for as little as USD 5.00.
But recently, these investment-tech startups were rocked by the SEC which deemed their operations to be in contravention of the law.