In Nigeria today, an estimated N190 billion in unclaimed dividends exists, with various reasons contributing to this issue. Factors range from individuals relocating without updating their addresses with investment firms to inheriting shares and needing to be made aware of entitled dividends or simply losing track of investments. In some cases, individuals may have passed away.
N190 Billion Unclaimed Dividends
Renowned finance coach Seyi Abiodun recently addressed the issue of unclaimed dividends in a post, enlightening his followers on how to identify and claim them. Abiodun emphasized that unclaimed dividends might be associated with personal investments and family members, encouraging periodic checks on the portal for potential surprises.
His post generated over 200 comments, with followers expressing success stories of finding unclaimed dividends after checking the portal.
One user shared their experience with Transcorp shares from 2010, while another sought advice on claiming dividends for a deceased parent holding shares in Dangote Flour Mill.
Last week, the Securities and Exchange Commission reported the total unclaimed dividends at N190 billion, underscoring the issue’s magnitude.
Understanding dividends and how they are paid
Dividends represent a company’s profit-based payment to shareholders. Companies determine the payable dividend per share with shareholder approval, providing a valuable income stream, especially during inflationary periods. Cash dividends are credited to registered accounts upon stock purchase.
What are unclaimed dividends
Unclaimed dividends occur when a company has issued dividends, but the shareholder has not claimed them. These unclaimed dividends can be associated with personal investments or those inherited from family members.
How to know the worth of unclaimed dividends
Getting the actual dividend amount requires contacting the company’s registrar, and in the case of a deceased person, a stockbroker can guide family members through the reclamation process.
How are unclaimed dividends stored?
Unclaimed dividends not claimed within six months are returned to the company as per CAMA 1990 (revised 2020), and after 12 years, they become statute-barred. The SEC manages the Unclaimed Dividend Trust Fund, and unclaimed dividends between 6 and 12 years are transferred to support government initiatives.
How to retrieve unclaimed dividends
To retrieve unclaimed dividends, individuals can follow a step-by-step process. The first step is visiting the SEC website and searching for personal information, such as the company, units, registrar, and account number. Once identified, downloading the e-mandate form, completing it, and submitting it to the registrar or local bank initiates verifying and processing unclaimed dividends.
Another avenue is through a stockbroker who conducts a search and retrieval process after opening an account. The increase in unclaimed dividends is attributed to companies changing names, mergers, and unawareness among investors about such changes.
A stockbroker can assist through a ‘ global search ‘ for those not finding their names on the SEC list or facing multiple similar names. The e-mandate form submission triggers a comprehensive check of Know Your Customer details.
Addressing the issue of unclaimed dividends requires proactive measures, periodic checks, and collaboration with financial experts to ensure individuals receive their entitled returns.