Connect with us
iubh
Advertisement
Alpha
Advertisement
Hotflex
Advertisement
british airways
Advertisement
Advertisement
UBA
Advertisement
Patricia
Advertisement
app

Business

Finance Act 2020: FG can borrow from unclaimed dividends and dormant account balances

With the signing of the Finance Act 2020 into law recently, FG can now borrow from the unclaimed dividends and dormant bank account balances.

Published

on

land borders to be reopened soon, Finance, Ministaer, vow to recover AMCON debt through issuance of promissory notes, FG reiterates stance on IPPIS as ASUU threatens strike, Finance Minister, Zainab Ahmed identifies capital market as key driver for economic growth , Nigeria has paid $1.09 billion to service its debts in 2019  , Dividends on oil proceeds will be taxed - FG , State governments own most bad roads - Finance Minister says, Budget deficit increases by N351.98 billion, as FG misses revenue target, Economy: Funding MSMEs in Nigeria , Finance Bill: New tax regime to take effect from Jan 2 - FG , Again, Finance Minister argues that Nigeria is not in debt distress , ECOWAS: Single currency regime not kicking off in 2020  , FG: CBN holds N43 billion stamp duty charges collected by banks , FG may shift deadline to deactivate bank accounts without tax verification, Confusion as ministry and presidency disagree over Finance Act start date, 7.5% VAT: Implementation to begin Feb 1 – FG , Finance Minister: Nigeria to go into recession if ..., Foreign tech companies that will now pay tax to FGN: see the criteria

The Finance Act 2020 recently signed into law by President Muhammadu Buhari clearly provides that the federal government can borrow from the unclaimed dividends and dormant account balances under the Unclaimed Funds Trust Fund.

The funds are made available as a special debt owed by the federal government to the respective shareholders and the dormant bank account holders.

READ: COVID-19: Why banks would rather donate billions to FG than credit their customers’ account

According to the Finance Act,

  • Any unclaimed dividend of a public limited liability company quoted on the Nigerian Stock Exchange and any unutilised amounts in a dormant bank account maintained in or by a deposit money bank which has remained unclaimed or unutilised for a period of not less than six years from the date of declaring the dividend or domiciling the funds in a bank account shall be transferred immediately to the trust fund

However, the official bank accounts owned by the federal government, state government, local governments or any of their ministries, departments or agencies are specially exempted by the Act.

READ: Active bank accounts in Nigeria surge to 111.5 million as COVID-19 drives account opening

What you should know

  • The borrowed funds by the FG shall be available for claim with the appropriate yield by the shareholders and the bank account holders at any time.
  • Failure by any company or deposit money banks (DMBs) to transfer such funds to the Unclaimed Funds Trust fund shall be considered as an offence and liable upon conviction to a fine of not less than five times the value of the funds plus accumulated interest on the amount not remitted to CBN, at the monetary policy rate.
  • The trust fund shall be supervised by the Debt Management Office (DMO) but governed by a governing council chaired by the Minister for Finance, with the co-chairperson from the private sector that is appointed by the president.
  • Such a person from the private sector shall be recommended by the Minister for Finance and duly confirmed by the Senate and must be of irreproachable integrity to serve in such capacity.
  • Other members of the Governing council include the CBN Governor, DG of Securities Exchange Commission, MD of NDIC, a representative of the Registrars of Companies, 2 representatives of the Shareholders Association, a representative of the Bankers Committee and DG of Debt management Office as the Secretary of the Trust Fund.

READ: AfDB board approves $10.4 billion borrowing plan for 2021

What this means

  • This means that the era of unclaimed dividends and dormant bank account balances is over.
  • There is no doubt that this would, to an extent, affect the deposit portfolios of some DMBs as quite a number of them are sitting tight on humongous float dormant account balances, at no cost to them.
  • Importantly, with these funds, it is expected that government would have more financial capacity to handle cost-intensive projects and infrastructural developments that would directly impact on the well beings of Nigerians if the funds are well utilized.

READ: Finance Minister, Heads, NNPC, DMO inspect Ajaokuta-Kano gas project

Hotflex
Sigma Pensions

Johnson is a risk management professional and banker with unbridled passion for research and writing. He graduated top of the class with B.sc Statistics from the University of Nigeria and an MBA degree with specialization in Finance from Ambrose Alli University Ekpoma, with fellowships from the Association of Enterprise Risk management Professionals(FERP) and Institute of Credit and Collections management of Nigeria (FICCM). He is currently pursuing his PhD in Risk management in one of the top-rated universities in the UK.

Click to comment

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Business

JAMB bans use of email by candidates for UTME, DE registration

JAMB has announced that candidates for the UTME and Direct Entry will no longer be required to provide their email addresses at the point of registration.

Published

on

The Joint Admission and Matriculation Board (JAMB) has announced that candidates for the Unified Tertiary Matriculation Examination (UTME) and Direct Entry will no longer be required to provide their email addresses at the point of registration.

The new adjustment is to protect candidates from various forms of manipulation and distortion of their personal details by some fraudulent cyber café operators.

The Registrar of JAMB, Prof. Is-haq Oloyede, who made the disclosure while addressing newsmen at the board’s headquarters on Wednesday in Bwari, Abuja, said the change, would take effect from Thursday, April 15, 2021.

What the JAMB Registrar is saying

Oloyede said, “They gain access to profiles of these candidates under the pretense of creating an email address for them. Then they change and block the candidates from receiving messages from the board. They also extort them after they change their passwords.

In view of this, the board has come up with adjustments to our operations. The first decision is that beginning from Thursday, April 15, candidates would no longer be required to provide any email address during registration from this year onwards.

It is by going to these cyber cafes to open emails that these candidates are open to abuse and stealing of their personal data,’’ he said.

He said that the board now had a mobile app that would allow candidates to deal directly with the board with their smartphones or via SMS to ‘55019’ code option.

Sigma Pensions

The code option, he explained, would allow candidates to check admission status as well as all other verifications via SMS.

He said, “Printing of examination slips, results notification or raising tickets can be done anywhere by using candidates’ registration number only. However, at the close of registration every year, we would need the email addresses of the candidates so we can have access to as many of them as possible.

british airways

At the conclusion of registration, candidates are expected to send their email addresses through the mobile app or text message to the 55019 code twice, for validation. This is to update their profile with JAMB as the email will no longer be used as access to their profile, but rather as a communication tool with candidates.’

While advising candidates to guard their phones with utmost care as it was the weapon for all transactions, Oloyede said that henceforth, all JAMB owned Computer-Based Tests (CBT) centres across the country, would only allow candidates with ATM cards into its centres.

He said that in order to cut down on the activities of fraudsters who hijack candidates to extort money from them, the centres would no longer allow candidates go outside the centres to pay for their e-pins and other cash transactions.

Stanbic 728 x 90

The JAMB Registrar said, “Only candidates with ATM cards will be allowed into all JAMB owned CBT centres, it can be that of their parents as long as they have the pin for the transaction.

“Those without ATM cards can go to other privately owned CBT centres where they can pay cash to register but we will not take cash or transact outside our centres.’’

What you should know

Meanwhile, in a related development, JAMB had said that the board lost over N10 million in 2020 to activities of fraudsters who penetrated their payment portal for ad-hoc staff.

The JAMB Registrar said that the money, which was meant to pay JAMB ad-hoc staff from the 2020 Unified Tertiary Matriculation Examination (UTME), was hijacked by the suspected fraudsters.

JAMB had a few days ago confirmed the commencement of registration for the 2021 UTME/DE examinations after the initial hiccup.

It stated that applicants must provide NIN at the point of registration with the registration by Direct Entry candidates to run concurrently with that of UTME candidates.

Coronation ads

Continue Reading

Business

FG grants 8 barge operations licenses as cargo movement to Onitsha port, others set to commence

The government is likely to generate billions of naira in revenue from the movement of cargo from Lagos ports to other inland ports across the country.

Published

on

We don’t have $1 billion hidden account – NPA

The Federal Government has issued operating licences to about 8 barge operators to move containers from Lagos Ports to Onitsha River Port and other inland ports through the country’s inland waterways.

This is as the government is likely to generate billions of naira in revenue with the planned movement of cargo from Lagos ports to Onitsha River Port and other inland ports across the country.

According to a report from Thisday, the Federal Government would likely generate as much as N30 billion annually from that operation if well managed, although the Nigerian Inland Waterways Authority (NIWA) is yet to make the estimated revenue from the effort public so as not to jeopardize the project.

This is coming after some government officials had in August 2020, announced that some government maritime agencies are working on modalities for the commencement of transportation of containers from Lagos ports to Onitsha River port through barges.

The Managing Director of NIWA, George Moghalu, at a meeting with the stakeholders in Lagos, said that moving cargoes by waters through barges would be cheaper than roads adding that the initiative was part of ongoing efforts to solve the gridlock in Lagos ports.

What the Managing Director of NIWA is saying

He said that NIWA management decided to have a meeting with the barge operators that it has already licensed to fashion out ways to make the project successful.

Moghalu specifically said, “So it is all about moving cargo between Lagos and Onitsha and other inland ports. We have licensed about eight barge operators. A lot of people have applied but we are being very careful because we have the Standard Operating manual, which we strictly insist that you have to meet all the requirements. At the same time also we do not lose sight of the fact that NPA also licenses barge operators. We try to synergise our operations so standards are not compromised.”

He said the use of the nation’s waterways would save the country’s decaying infrastructure and the money spent on repairing and rebuilding them and increase revenue generated by the government.

Sigma Pensions

On the security of cargo, the NIWA boss said: “Even on the road, there are security challenges. So, there are security challenges everywhere and there is no way we would discuss the movement of cargoes without looking at the security challenges. There’s a case of getting everybody involved, the Navy, Police, the NIWA Police, Marine Police and even the local communities because security is everybody’s concern and we all have to address it.”

He pointed out that the charges for using the waterways would be cheaper than moving cargoes by road as the modalities for moving cargoes from Lagos to Onitsha is being worked out.

british airways

He said, “People are creating unnecessary fear about insecurity, when I came into the office and made up my mind to explore the possibility of using our inland waterways, everybody discouraged me. Then we did a trial run using Onne to Onitsha and it worked.

It is about identifying the channel, and surveys on a regular basis. We have our report guiding those that are going to use it and they will use it. I don’t want to be discouraged and I don’t want anything to dampen my enthusiasm like the enthusiasm of those working with us, the channels are navigable and the consignment will move.”

In case you missed it

The National Inland Water Ways Authority had last month, made public its intention to move 1000 containers per trip from Lagos ports to Onitsha river port within a maximum duration of 4 days.

Stanbic 728 x 90

It said that the idea of hauling containers from Lagos ports via Burutu Ports to Onitsha River Port is to deliberately avoid the two small bridges of Gbarekolo and Bumandi, which are too tiny and shallow for sea-moving badges or vessels to ply.

Continue Reading

  





Nairametrics | Company Earnings

Access our Live Feed portal for the latest company earnings as they drop.