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Retail shareholders have renewed calls on the Securities and Exchange Commission (SEC), registrars, and capital market operators to simplify and streamline the claims process for unclaimed dividends, citing persistent administrative challenges and procedural delays as key factors driving the surge in unclaimed dividend figures.
Speaking to journalists in Abuja on Sunday, shareholders emphasized that making the claims process more transparent, accessible, and user-friendly is essential to curbing the growing backlog of unpaid dividends across the Nigerian capital market.
Mounting Concerns Over Unclaimed Dividends
Reacting to recent data showing an upward trend in unclaimed dividends from banks and publicly listed companies, stakeholders expressed concern that the current dividend recovery process remains cumbersome, discouraging many legitimate claimants—especially next-of-kin and minority investors—from pursuing their entitlements.
Mrs. Bisi Bakare, National Coordinator of the Pragmatic Shareholders Association, noted that probate-related bottlenecks, high administrative costs, and registrar inefficiencies are significantly contributing to the increase in dormant dividend accounts.
“Some of the key challenges include fictitious identities used during the privatisation era, relocation without proper updates, and a general lack of awareness among family members of deceased shareholders,” Bakare stated.
She added that many shareholders had acquired multiple share certificates under different names during public offers, but later lost track of them—especially before the advent of e-dividend mandates.
“In numerous cases, spouses and children are unaware of these investments. How do you claim what you don’t even know exists?” she asked, urging regulatory bodies to implement reforms that enable seamless transmission of shares and dividend rights.
Calls for Stakeholder Collaboration
Mr. Moses Igbrude, National Coordinator of the Independent Shareholders Association of Nigeria (ISAN), expressed dismay that even newly listed entities on the Nigerian Exchange Group (NGX) have started accumulating unclaimed dividends, a trend he described as “alarming and avoidable.”
He urged registrars to proactively leverage shareholder contact information—including email and mobile phone records—to reach out to rightful owners of unclaimed dividends.
“Rather than rely on passive mechanisms, registrars should engage in direct communication with shareholders. Banks, too, can use internal systems to identify dormant dividend holders and notify them accordingly,” Igbrude stated.
He also criticized the creation of the Unclaimed Dividend Trust Fund (UDTF) by the SEC, suggesting that the initiative alone is insufficient to address the systemic challenges. Instead, he called for a multi-stakeholder approach, including greater awareness campaigns, digital onboarding for probate processes, and the use of RegTech solutions to modernize the dividend claim value chain.
“If stakeholders are truly committed to solving this issue, we must deploy multi-dimensional strategies that encompass legal, technological, and administrative reforms,” he added.
Rising Unclaimed Dividend Balances
Despite the inauguration of initiatives such as the Nigeria Inter-Bank Settlement System (NIBSS) in partnership with the SEC to digitize dividend payments, the challenge persists.
Recent financial reports show that several Tier-1 Nigerian banks have reported significant increases in their unclaimed dividend liabilities for the 2024 financial year:
- United Bank for Africa (UBA) Plc recorded ₦45.99 billion in unclaimed dividends in 2024, up sharply from ₦14.90 billion in 2023.
- Zenith Bank Plc reported ₦30.6 billion, slightly up from ₦30.1 billion in the previous year.
- Access Holdings Plc, however, showed progress with a decline to ₦17.73 billion in 2024, down from ₦21.3 billionin 2023.
Path Forward: Enhancing Trust and Inclusion
As the Nigerian capital market strives to deepen retail participation and investor confidence, resolving the unclaimed dividends crisis remains a critical policy imperative. Experts argue that digitization, legal reforms, and collaborative stakeholder engagement will be essential to unlocking dormant funds and reinforcing financial inclusion, trust, and transparency in the capital market ecosystem.
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