Nigerian Exchange Limited (NGX) has said that a mix of financial literacy and awareness will help to reduce the growing number of unclaimed dividends in the capital market.
The Divisional Head, Capital Markets, NGX, Jude Chiemeka stated this at a recent retail investors webinar themed; How to Process Outstanding Dividend.
This is coming after efforts by the Securities and Exchange Commission (SEC) to tackle rising unclaimed dividends in the nation’s capital market have continued to hit a brick wall.
According to the commission, unclaimed dividends in the Nigerian capital market had risen to N190 billion from N180 billion recorded in 2021.
Reacting to this development, Chiemeka noted that some retail investors are unaware of the backlog of unclaimed dividends that have accrued to them over many years, especially those investors with legacy investments held on their behalf.
Whilst adding that the webinar- held in collaboration with Futureview Asset Management Limited, is aimed at providing procedures to investors, especially the retail segment on how to process outstanding dividends and retrieve unclaimed dividends, Chiemeka said a mix of financial literacy and aggressive awareness can help to reduce unclaimed dividends in the market.
He also added that the Exchange remains committed to utilizing technology to optimize intermediaries and increase access to the market for retail investors.
“To this end, we have established a digital gateway to democratize access to the market, reduce friction, and drive retail participation in the capital market.”
Chiemeka assured that the SEC would continue to work assiduously with stakeholders to reduce the cases of unclaimed dividends in the market to the barest minimum.
What you should know
The Securities and Exchange Commission (SEC) has stated that the unclaimed dividends in Nigeria’s capital market now stand at the region of N190 billion.
The Director-General, of SEC, Lamido Yuguda, disclosed this during the commission’s second Capital Market Committee (CMC) briefing which was held in Lagos via Zoom on Friday.
The Capital Market Committee (CMC) was established to serve as a medium for the exchange of ideas among market stakeholders as well as for feedback to the Securities and Exchange Commission (SEC) on how to continuously improve market activities and regulation.
Yuguda stated that the commission is working with the Nigeria Inter-Bank Settlement System (NIBSS) on the e-dividend portal currently going through upgrading and data repairs.
While explaining that unclaimed dividends are still a recurring problem in the market, Yuguda noted that the SEC is currently facing challenges such as identity management, and multiple subscriptions which is aggravating the number of unclaimed dividends.
“The estimated figure of unclaimed dividends so far in the market stands at N190 billion. The SEC is working with NIBSS to make changes to the electronic dividend portal which is currently going through some form of upgrading and repair.
“We are working very hard to ensure we reduce the number of unclaimed dividends, and this is why we are upgrading the e-dividend portal with NIBSS to restore investors’ dividends and reduce unclaimed dividends and we reiterate that every person, who has come to the capital market and invested money, should be able to get his dividends as and when due,” he said.
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