The objective of the book-entry system is to provide participants in the market for Government securities with a format for holding securities without physically holding certificates, that is, dematerializing the securities. This is achieved by creating an electronic ownership record for both Treasury Bills and Bonds/Internal Registered Stock (IRS) issued by the Government of the Republic of Namibia through its agent the Bank. Participants in the system are entitled to statements of their holdings after every transaction, on a monthly basis and upon demand.

It eliminates the need to print and manually handle securities and the risk of papers being lost or miss-placed is therefore eliminated. The system also reduces the amount of time needed to deliver securities and if it is linked to the Settlement System it reduces the amount of time needed to settle and altogether minimize settlement risk. Its efficiency is expected to stimulate secondary market activities and facilitate open market operations. Further, it will make it easy for commercial banks to pledge bills to the central bank.

The system entails two main functions, namely, securities dealing and accounting (settlement). Functions like initial data entry, primary sale, secondary sale, and debt service fall under the two broad categories stated above.

The application and signing of the application forms by participants amounts to an agreement between the participant and the Bank of Namibia, where by the participant agrees to adhere to the rules and administration procedures as set out in the Rules for Participation and Administration procedures.