Fintech will boost investor confidence in stock market: Experts

Investor trust, transparency, and access to the stock market, will increase as the use of fintech [technology used to support or enable banking and financial services] increases, said market experts at an event, marking World Investor Week.

Fintech can play a major role in the stock market because many professionals are coming to this market and by using modern technology, they are advancing the market, experts said at the programme organised by the Dhaka Stock Exchange (DSE) and the DSE Brokers Association of Bangladesh (DBA), at the DSE office in the capital on Monday.

Bangladesh Securities and Exchange Commission (BSEC) Commissioner Md Abdul Halim was present as chief guest at the event presided over by DSE Chairman Eunusur Rahman.

Presenting the main article at the event, Md Saifuddin, managing director of IDLC Securities Limited, said, "Trust is the most important factor for any financial system to work. And transparency will improve the trust of the investor community to enter the capital market."

Furthermore, real-time pricing and instant access to transactions also play an important role for investors in the capital market, such as ledger history, breakdowns for all fees and charges, tax reports, audit trails, and analytics on trades, he added.

"Digital brokerage services worldwide have increased manifold during the Coronavirus pandemic. Such services are also growing in Bangladesh. Currently, there are 18 lakh Beneficiary Owner (BO) accounts [required for stock market trading] in the country, which may increase to 80 lakh by 2030," he added.

BSEC Commissioner Abdul Halim said, "Ordinary investors in the stock market suffer losses due to a lack of professional skills and various other reasons. These investors need to be protected with education in investment."

Two major incidents have occurred in our market in the past and many laws and regulations have been made to prevent such situations in the future. Apart from this, many reformative activities have also been carried out to improve the market, he said.

"About 58% of citizens in the USA participate in the stock market, but in our country only 2% (a little over 10 lakh) of citizens are involved in the market. In 2030, the number is likely to rise to 80 lakh," Abdul Halim added.

DSE Chairman Eunusur Rahman said, "DSE is working on setting up a modern data centre. We are hopeful that a state-of-the-art data centre will be established by 2022. The more fintech is used, the more risks will come with it. We have to be aware of some essential matters to minimize these risks."

President of DSE Brokers Association of Bangladesh (DBA), Richard D Rosario, said, "We are all closely related to technology. The Dhaka Stock Exchange has followed the same path. It has already taken various steps so that trading will never stop."

"Government securities are now being traded in the stock market. A new window has opened in the market and as a result of this, trading volume will increase," he added.