Nairobi bourse to embrace digital records
By Semaj Itosno, Nairobi, Kenya
The Nairobi Securities Exchange (NSE) will soon discard use of physical records as the official proof of shares as it goes digital.
Consequently all investors at the NSE are required to convert all shares held in paper form to electronic accounts which will also be used for corporate actions.
The bourse and Kenya’s Central Depository and Settlement Corporation (CDSC) have proposed to start using electronic records from November 30 2012. CDSC says already 80.95% of the shares available for trading at the NSE are in electronic form.
Also known as dematerialization, the move to a fully electronic process started in 2004 after CDSC was formed. This allowed for the surrender of physical certificates with an electronic record of holdings through a process known as demobilization.
“From the dematerialization date, share certificates shall no longer be recognized as the prima facie evidence of ownership of shares and this will be replaced with the electronic record at the depository,” reads a joint statement from the CDSC and NSE.