Shareholders Urge SEC to Streamline Unclaimed Dividend Process in Nigerian Banks
LAGOS, Nigeria — Shareholders in Nigeria’s capital market are intensifying calls for the Securities and Exchange Commission (SEC) to overhaul the unclaimed dividend process in Nigerian banks, as the value of unclaimed dividends has surged to N215 billion, according to a May 2025 report by Nairametrics. The New Dimension Shareholders Association of Nigeria, among others, has urged the SEC’s Acting Director-General, Dr. Emomotimi Agama, to implement urgent reforms to address systemic inefficiencies and ensure investors can access their rightful funds.
The issue of unclaimed dividends—payments owed to shareholders that remain uncollected—has plagued Nigeria’s capital market for over a decade. In 2023, unclaimed dividends in the banking sector alone reached N79.57 billion, an 8% increase from the previous year, with Ecobank and FBN Holdings reporting the highest amounts at N14.37 billion and N14.62 billion, respectively. The problem stems from outdated shareholder records, cumbersome registration processes, and identity management challenges, exacerbated by the deaths of investors without updated beneficiary details.
Shareholders have criticized registrars, the entities responsible for managing shareholder records and dividend payments, for poor record-keeping and bureaucratic hurdles. Olalekan Oregbesan, a shareholder, told Punch Newspapers that registrars often demand redundant documentation, such as signature specimens from brokers, even after e-dividend mandate forms are certified by banks. A recent X post by @GazetteNGR echoed this sentiment, quoting shareholders who urged the SEC to make the claims process “seamless” to reduce investor frustration.
The SEC has introduced measures to curb the crisis, including the Electronic Dividend Mandate Management System (E-DMMS), launched in collaboration with the Nigerian Inter-Bank Settlement System (NIBSS). This platform allows dividends to be credited directly to shareholders’ bank accounts upon registration. In February 2024, a self-service portal was added to simplify applications for unclaimed dividends. Additionally, the SEC’s website hosts a search portal for investors to check unclaimed dividends, a tool praised by shareholders but limited by low awareness and technical issues.
Despite these efforts, the unclaimed dividend pool continues to grow. A 2021 Finance Act mandates that dividends unclaimed for six to twelve years be transferred to the Unclaimed Funds Trust Fund, managed by the SEC and the Debt Management Office, for federal government borrowing. After twelve years, these funds become statute-barred and are forfeited to companies, leaving shareholders with little recourse. Critics argue that registrars and banks may benefit from delayed payments, as unclaimed funds remain in their custody, raising questions about deliberate inefficiencies.
Dr. Agama, speaking at a Capital Market Committee meeting in Lagos in August 2024, reiterated the SEC’s commitment to resolving the issue through advanced technology and stakeholder engagement. He announced the formation of a specialized committee to address root causes, such as identity theft and outdated records, and emphasized collaboration with registrars and banks to streamline payouts. The SEC also launched a multilingual awareness campaign in May 2025, using Pidgin, Igbo, Hausa, and Yoruba guides to encourage e-dividend registration, as highlighted in a post by @SECNigeria on X.
Shareholders, however, remain skeptical. Moses Ayodele Ogundeji, an ex-banker, told Vanguard News that integrating Bank Verification Numbers (BVN) could simplify identification and reduce fraud, a suggestion echoed by Professor Segun Ajibola of Babcock University, who called for seamless record updates by registrars. Some shareholders, like Jide, who shared his experience with Businessday in 2019, described frustrating back-and-forths with registrars demanding additional forms, even after completing e-dividend mandates.
The crisis has broader implications for investor confidence in Nigeria’s capital market, a key driver of economic growth. With the SEC aiming to support a $1 trillion economy through increased market listings, the persistent unclaimed dividend issue risks deterring investment. A Nairametrics post on X underscored the urgency, noting shareholders’ demand for “action to streamline” the process to prevent further escalation.
As the SEC navigates these challenges, shareholders are calling for stricter oversight of registrars, public sanctions for non-compliance, and simplified procedures for next-of-kin claims, particularly for deceased investors. Until these reforms are fully implemented, the N215 billion in unclaimed dividends remains a stark reminder of systemic gaps in Nigeria’s financial ecosystem.
Sources: Nairametrics, Punch Newspapers, Businessday NG, Vanguard News, TheCable, The Guardian
