The Johannesburg Stock Exchange (JSE) is placing innovative digital solutions at the centre of its strategy to enhance products and services.
This, as the bourse looks to automate and streamline private capital raising processes.
The JSE says technology is part of its genetic code, and as digital transformation accelerates, it will continue seeking digital solutions that add value to its operations.
Sam Mokorosi, head of origination and deals at the JSE, spoke to ITWeb on the local adoption of tech solutions for capital markets, especially on the back of the growing success of the stock exchange’s recently launched JSE Private Placements (JPP) platform.
The JPP is a digital platform that connects private companies and issuers directly to investors, which, Mokorosi says, has become a catalyst for innovation.
He notes the platform has already had an impact, attracting billions of rand ready for deployment to fund deals in mining, renewable energy, health, construction and tech start-ups.
Mokorosi says this and much more will help build South Africa and create much-needed job opportunities.
The JPP platform was launched in December to facilitate innovation and growth in private capital raise, in both equity and debt.
JPP’s services are offered in association with Globacap, a UK-based capital markets technology company in which the JSE owns a minority stake.
According to the JSE, Globacap has standardised the securities landscape, enabling “frictionless asset creation and transferability”.
It says over $10 billion of private share and debt instruments are digitally managed on the Globacap platform for over 80 companies and 4 300 investors.
Now, with the JPP online solution, the JSE says, investors can access an array of potential deals that meet their investment criteria, as well as track the history of previous placements and deals, “providing much-needed visibility in this fast-growing segment of the market”.
Mokorosi tells ITWeb: “Technology is part of the DNA of the JSE. We continue to explore ways to add value through innovative digital solutions such as Globacap, to enhance our products and services.
“As the JSE, we are always on the lookout for innovative ways we can improve our service to the market. We collaborated with Globacap to digitise capital raising for unlisted companies.
“The response from the market has been very positive because of the value JPP brings. Companies looking for capital do not have to spend hours compiling proposals and knocking on many different doors hoping to meet with interested investors.
“This, therefore, places the JSE in an excellent position to support economic growth and job creation through infrastructure development by simplifying the debt raising process for the SME sector.”
Further, according to Mokorosi, through the JPP, the JSE has made a strategic decision to broaden its revenue stream by entering the private equity and debt market not just in SA, but the rest of the continent.
“Since obtaining our FSP licence late last year, the JPP has made excellent progress and has already attracted about R5 billion that is ready for deployment to fund deals in mining, renewable energy, health, construction, tech start-ups and much more, to help build South Africa and create much-needed job opportunities.
“Also, the other category of funding available is from the venture capital market. It is suited for tech start-ups that are still in the early stages of development.
“There is also asset-backed debt funding opportunities suited for SMEs that want to purchase office or yellow equipment such as tractors and bulldozers, as well as procurement-based finance when an SME has a contract but needs finance to honour the contract.”
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