Migration of shareholders to e-dividend regime underway, says SEC

The Securities and Exchange Commission (SEC) says it is currently leading the entire capital market industry in an effort to migrate all shareholders to an e –dividend regime.

Disclosing this at the weekend, its acting Director-General, Mary Uduk, said the essence of the e-Dividend Mandate Management System, is to eradicate or reduce to the barest minimum the incidence of unclaimed dividend.

Uduk explained that unclaimed dividend is an undesirable feature of the Nigerian capital market which denies investors/shareholders the gains of participating in the capital market, adding that it denies the economy access to the huge amount of money which should have accrued to shareholders and would have gone into circulation to oil the wheel of the economy.

She said, “It is a consequence of the bottlenecks which are inherent in the erstwhile paper dividend warrant regime such as postal system inefficiency, change in investors’ addresses, poor fidelity and human fallibility in dividend payment processes, among others”.

Uduk stated that the e-dividend regime bypasses these limitations by ensuring that dividends, which do not exceed 12 years of issue, are credited directly to an investors account after declaration by the paying company and within a stipulated payment period through simple interbank transfer. The Acting Director-General further advised Nigerians to desist from investing their money in various investment schemes that are not registered to carry out fund management functions.

Uduk, while enjoining investors to be wary of any investment that is proposing return levels that are unreasonably high, also advised investors to always cross check that such fund managers and the products they are offering are registered with the SEC.

According to her, the capital market is properly positioned to attract Nigerians and  provide benefits to Nigerians who invest therein.

She said SEC has been doing a lot in terms of investor education to assist people understand whatever issues  they have around the capital market.

“But besides that, there are new products coming up every day in the Nigerian capital market. We have a lot of ethical funds, one of the safest areas to invest is in Mutual Funds, Collective Investments Schemes and we encourage Nigerians to be part of these and others,” she revealed.