Chaka, A Gateway To Markets For Global Investors, Secures License, Eyes Innovation

Alongside the pandemic, investors around the world flocked towards highly engaging activities, such as day trading.

In light of the rise in retail trading volumes, Chaka, the go-to, low-cost financial markets gateway for underserved African investors, saw a rise in funded accounts catching the interest of financial regulators.

Nigeria’s SEC then effectively barred the company from offering its services, the result of increased regulatory scrutiny on Africa’s booming finance and technology ecosystem.

“We always kept in touch with regulators and so, when the issue came up, we were very confident in a swift resolution,” Chaka founder and CEO Tosin Osibodu told Benzinga in an interview.

Soon after, the SEC granted Chaka the first-ever license to operate a digital platform for buying and selling stocks.

“We ended up convincing them that what we were doing was a legitimate activity that benefitted the market and it’s clear that a fintech license needed to be created for what we were doing.”

Current Projects: With regulators validating its innovation and impact on the market, Chaka built on its trading app and migrated to a new platform.

Now, Chaka gives African investors fractional access to 11,000+ global stocks and ETFs, a serious achievement for a firm that’s only been up and running since 2019.

“With the need to serve businesses, as well, we were always building an enterprise-wide system where different businesses could have their own trading front-ends or engines,” Osibodu said about Chaka’s business lines.

In the simplest way, Chaka is multi-faceted. Apart from the trading app is Chaka SDK, a digital investment solution for asset managers, and Chaka for Business, a direct business onboarding and trading tool for institutional investors.

Conversion: Just last month, retail investors bought nearly $28 billion of stocks and exchange-traded funds, the highest amount deployed in a single month since 2014.

That is a positive with meme stock volatility disappearing as traders return to work, post-COVID.

“The pandemic did do a lot to make people aware of investing,” Osibodu noted. From beginner to advanced, across all types of investing styles, Chaka users were more engaged.

“Very quickly you saw the bottom fall out on the market and the passive [crowd] was forced to start thinking a lot more about their finances, and they seemed to enjoy it.”

Amidst evolving user personalities, Chaka honed in on making it easier to diversify into stable assets.

“We’re aware of [demands] … for more stable ways to invest,” the CEO said in reference to initiatives to provide users material insights to act on. “We have a narrative to make sure you build a habit of investing.”

Consumer-Focused Innovation: In the early 1900s, the “greatest generation” was taught to trust the government and take no risk. Now, however, investors only trust themselves and their embedded networks, like TikTok, YouTube and Twitter.

“On the highest volume trading days, you tend to see some kind of social correlation,” Osibodu explained. “On most days of the year, though, that’s not the case.”

In keeping users engaged, Chaka is committed to expanding the depth and breadth of its product portfolio.

“The team we’re building is very exciting … we’re expanding beyond Nigeria into other countries, and we’re expanding our actual offerings. It’s very important that we paint the right lines and themes – whether it’s trading local or beyond, passive investing and robo, or crypto – and we’re also very bullish on regulators clearing the path to innovation.”