Nigerian capital market investors are now guaranteed payment of their dividends within 24 hours of declaration through the e-dividend payment platform initiative by the Securities and Exchange Commission (SEC).
The Director General of SEC, Mounir Gwarzo, said on Thursday in Lagos that the platform would automatically allow dividends to be credited directly into shareholders’ accounts within hours of payment by the company.
Mr. Gwarzo said the initiative was part of the Commission’s 10-year Capital Market Master Plan to encourage retail investors to return to the market, thereby deepening the market.
He said the only way to attract retail investors back to the market was to take steps to address their concerns.
“The domestic investor is the only that, no matter the condition of the market, will stay with us,” the SEC DG said. “What we have been experiencing in the market is the dominance of the foreign investor where, anytime they want, they move out of the market and don’t come back.
He said one of the reasons retail investors are not in the market was the complaint about not getting their dividends, pointing out that the e-dividend payment platform has made Nigeria one of the countries in Africa that payments are done on transactions within five days.
“With this system, Nigeria is going to achieve T+1 settlement system, where payment are effected within 24 hours on shares sold today,” Mr. Gwarzo said. “This is going to be the first capital market in Africa to achieve that feat.
“Once the e-dividend platform becomes fully operational, he said the issue of stale warrant would be checked, while travelling from one place to another to deposit the warrant or change of address, would be a thing of the past.
“The issue of unclaimed dividend, which is in excess of N90billion, will be eliminated. These unclaimed dividends are from small stakeholders and we need to ensure that they are claimed.”
The era of proceeds not being remitted for shares sold, the SEC DG said, would stopped with the use of BVN and e-dividend platform, adding that once an investor register for e-dividend, he would benefit from the Direct Cash Settlement.
The BVN platform, he explained, would enable the Commission to implement other initiatives to ensure investors have their data captured. That will check impersonation, he said.
The Executive Director, Market Operations and Technologies of the Nigeria Stock Exchange (NSE), Ade Bajomo, commended SEC for working to get every Nigerian investor get their dues in good time.