The rush by retail investors to purchase Dangote Refinery shares led to service disruptions across Nigerian investment apps, highlighting the stress that Africa's largest-ever share sale is placed on digital finance platforms.
Regulators and market participants have encouraged first-time investors to be cautious as the record $1.6 billion offering, launched this week by Aliko Dangote, seeks broad public participation through banks, mobile operators and fintech platforms.
No demand data has been disclosed by Dangote or the underwriters, but the service disruptions indicate high retail interest in the share offer and show how fintech companies are increasingly helping to open up Nigeria's capital markets.
When the IPO launched on Monday, Temi Popoola, CEO of NGX Group, said demand was so high that some investment apps crashed.
“I think this particular IPO is stress testing Nigeria’s financial infrastructure across the board. Us fintechs are being tested to take this massive amount of traffic,” Yanmo Omorogbe, co-founder and chief operating officer at one of the largest platforms, Bamboo, told Reuters.
Omorogbe said Bamboo went down when app traffic spiked to 10 times its usual volume just 30 minutes after the IPO opened on Monday, with the overload spilling over to some third-party service providers.
So you have almost a perfect storm, or should we say an imperfect storm, of massive influx of customers, third-party providers, and then multiple retries, creating even more demand on our system,” Omorogbe said. “And to be very, very honest, our system broke.”
Users of other platforms that allow digital share subscriptions, including Cowrywise and InvestNaija, also reported difficulties experienced in accessing services and executing transactions.
InvestNaija rerouted users to its WhatsApp channel after its platform was overwhelmed.
Bamboo and InvestNaija said services were back to normal by Wednesday, while Cowrywise did not respond to requests for comment.