Nigeria’s apex capital market regulator, Securities and Exchange Commission (SEC) has stated that more than N30 billion has so far been paid to investors in the Nigerian capital market from the backlog of unclaimed dividends.
In a statement, the Commission said that as a means to further reduce the unclaimed dividends profile and curb its growth in the country, it will continue to underwrite the cost of e-dividend enrolment till 30th June, 2017.
According to SEC, with a view to ensuring all investors benefit from the e-dividend programme free of charge, the Commission had committed to pay the cost of enrolment throughout the year 2016, and had resulted in getting about 48 per cent of investors to enroll for the e-dividend payments.
“Arising from this exercise, over N30 billion which was hitherto unclaimed have so far been credited to respective bank accounts of investors. Therefore, the advantage of the e-dividend is not only to enable investors collect subsequent dividends electronically but it allows all accrued dividends be credited to investors’ bank accounts,” SEC stated.
The Commission stated that it has however observed with concern the challenges being experienced by investors in the course of the e-dividend registration and therefore commits to further defray the cost of registration till June 30th, 2017 to enable investors continue to enjoy the free registration.
SEC also reminded the investing public that at the expiration of the free registration period, Dividend warrants will no longer be issued as it would be replaced with electronic dividend payments.
The apex capital market regulator said the extension underscores the Commission’s strong focus on market development and enhancement of investor confidence.
“All investors in the Nigerian capital market are therefore advised to take advantage of this extended grace period by approaching their bankers or registrars for enrolment before the deadline,” SEC advised.
E-dividend payment platform was introduced to address the rising incidence of unclaimed dividends in the Nigerian capital market. It is also expected to address the lingering problem of unclaimed dividends, which the market had sought solution for the past 20 years.
SEC DG, Mounir Gwarzo had recently said that efforts made by the commission to ensure that the era of stale dividends and huge unclaimed dividends in the market become a thing of the past was already achieving result with the e-dividend registration system.
“When we started the e dividend, the major challenge was for people to key into the e dividend mandate. There are unclaimed dividends that have not been claimed, the registrars have been compelled to pay all the arrears of unclaimed dividends.
“In this country, we have never had this kind of initiative that has reduced unclaimed dividends like we had today. Apart from the investor getting his dividends where ever he is, that investor will be able to get dividends that in the last five years he has not been able to get. The e-dividend is for the interest of retail investors” he added.
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