Shareholders seek easier access to soaring unclaimed dividends

Amid rising frustration over administrative hurdles, Nigerian shareholders have called on the Securities and Exchange Commission (SEC), registrars, and stockbrokers to urgently streamline the process of claiming unclaimed dividends.

The call comes as concerns deepen over the growing volume of unclaimed dividends held by banks and publicly listed corporations.

Investors argue that the current process is fraught with inefficiencies, making it difficult for rightful owners to access their entitlements.

They warn that unless decisive steps are taken to simplify procedures, more dividends will remain unclaimed, undermining investor confidence in the capital market.

Mrs. Bisi Bakare, National Coordinator of the Pragmatic Shareholders Association, identified several causes behind the backlog. One major challenge, she noted, stems from shareholders who purchased shares using different variations of their names, often without keeping adequate records. This practice, she explained, has made reconciliation difficult in the absence of complete documentation.

Bakare emphasized the need for widespread adoption of electronic dividend registration (e-dividend) and urged shareholders to regularly update their details with registrars. “Digitizing shareholder records and encouraging ongoing engagement with registrars are critical to resolving this issue,” she said.

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Echoing similar concerns, Mr. Moses Igbrude, National Coordinator of the Independent Shareholders Association of Nigeria, observed that even newly listed companies on the Nigerian Exchange Group (NGX) are grappling with unclaimed dividend problems. He described this as a systemic issue, calling for an overhaul of the current dividend disbursement framework.

Igbrude criticized the SEC’s current approach, particularly its establishment of a dividend trust fund, which he described as inadequate. Instead, he advocated for a more holistic solution involving all key stakeholders—registrars, stockbrokers, listed companies, and shareholder groups.

“If the stakeholders are truly sincere, we need a multi-pronged approach that ensures transparency, investor education, and active engagement across all sectors,” he stated.

He also called for the simplification of share inheritance processes, particularly for the next of kin of deceased shareholders, noting that lengthy bureaucratic procedures often discourage families from pursuing claims.

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Responding to the growing outcry, the Director-General of the SEC, Dr. Emomotimi Agama, underscored the commission’s commitment to transforming Nigeria’s capital market through digital innovation.

Agama said the key to solving the unclaimed dividend crisis lies in robust identity verification systems.

“The issue is fundamentally about accurate identity management. Once we can match shareholders with their correct information, there will be no reason for dividends to go unclaimed,” he explained.

He added that digitizing operations would not only enhance efficiency in capital raising but also address long-standing identity-related challenges in the system.

With increasing calls for transparency, better communication with investors, and the acceleration of digital transformation efforts, Nigeria’s capital market stands at a critical juncture.

Stakeholders remain hopeful that ongoing reforms will ease access to dividends, boost investor trust, and strengthen overall participation in the market.