SEC Targets Unclaimed Dividends with Technology and Identity Management
By Patience Ikpeme
The Securities and Exchange Commission (SEC) is taking steps to address the persistent issue of unclaimed dividends in the Nigerian capital market by leveraging advanced technology and robust identity management systems.
This was disclosed in a recent statement issued by the SEC, following a comprehensive review by the Commission and the Committee for Identity Management for the Capital Market.
According to the statement, the Director General of the SEC, Dr. Emomotimi Agama, nored that the primary obstacle contributing to the accumulation of unclaimed dividends is the inability to accurately identify investors. He noted that this problem is largely due to discrepancies in account numbers and other essential details that companies require to process dividend payments.
“Technology will be a solution,” Dr. Agama asserted, pointing out that the SEC is meticulously reviewing the entire process to ensure proper identification of investors. “The SEC is at the forefront of efforts to reduce, and ultimately eliminate, unclaimed dividends. We are committed to employing technology, education, and persuasion to help people understand the processes around claiming dividends and ensuring their proper identification. Any effort that reduces unclaimed dividends is a positive one for us.”
In its bid to curb the growth of unclaimed dividends, the SEC has launched the revamped e-Dividend Mandate Management System (e-DMMS) portal. This system introduces a self-service interface, enabling investors to mandate their accounts for e-dividends virtually, without the need to visit a registrar or a bank. The SEC has urged investors to access the e-dividend portal through its official website, ensuring a secure and authentic experience.
Dr. Agama assured investors that the portal, accessible via the SEC’s website (www.sec.gov.ng) and the Nigerian Interbank Settlement System (NIBSS) website, is safe and secure, protecting users from cyber threats. He highlighted the importance of this security measure, given the prevalence of cyber-attacks in the financial sector.
Addressing concerns regarding the request for Bank Verification Numbers (BVN) on the portal, Dr. Agama explained that the BVN is currently the most reliable method for verifying investors’ identities in the financial space. “We need to verify that you are who you say you are. If the BVN provided does not match your identity, it means it’s not yours. As an institution, we try to protect the investor and ourselves as regulators,” he stated.
The SEC is keenly aware of the challenges posed by unclaimed dividends to investors, who enter the market with the expectation of returns. The inability to receive these returns due to identification issues is a significant concern for the Commission. Dr. Agama noted that the Senate Committee on Capital Market recently held a hearing on the matter, during which the SEC reaffirmed its commitment to addressing the issue.
The SEC has called on investors whose shareholding accounts appear on the list of non-mandated accounts hosted on the Commission’s website to take advantage of the revamped e-DMMS portal. By clicking on the “NIBSS Self Service” link, investors can seamlessly mandate their accounts and ensure they receive their due dividends.
The SEC’s renewed focus on identity management and the adoption of technology marks a critical step towards resolving the unclaimed dividends issue in Nigeria. The Commission’s proactive approach underscores its dedication to protecting investors’ interests and enhancing the overall investor experience in the Nigerian capital market.
This initiative, along with continued efforts in education and public awareness, is expected to significantly reduce the volume of unclaimed dividends and restore confidence among investors in the market.
