Ada Johnson
Mon, Sep 4, 2023 11:35 AM

NGX calls for financial literacy to reduce unclaimed dividends

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NGX calls for financial literacy to reduce unclaimed dividends
Nigerian Exchange Limited (NGX) has emphasized the importance of financial literacy and awareness in reducing the growing number of unclaimed dividends in the capital market. With efforts to tackle this issue facing obstacles, the NGX highlighted the need for retail investors to be informed about the unclaimed dividends they may have, especially those with legacy investments. In a recent webinar, the Divisional Head, Capital Markets, NGX, shared the procedures for processing outstanding dividends and retrieving unclaimed dividends, stressing the role of financial literacy in addressing this issue.

Nigerian Exchange Limited (NGX) has said that a mix of financial literacy and awareness can help to reduce the growing number of unclaimed dividends in the capital market.

The securities and Exchange Commission (SEC) has been grappling with the issue of rising unclaimed dividends in Nigeria's capital market. The commission reported that unclaimed dividends had increased from N180 billion to N190 billion in 2021.

During a recent retail investors webinar titled "How to Process Outstanding Dividends," Jude Chiemeka, Divisional Head, Capital Markets, NGX, highlighted that many retail investors are unaware of the backlog of unclaimed dividends owed to them over the years, particularly those with legacy investments.

The webinar, held in collaboration with Futureview Asset Management Limited, aimed to provide investors, specifically in the retail segment, with the necessary steps to process outstanding dividends and retrieve unclaimed dividends.

Ziemeka emphasized that a combination of financial literacy and aggressive awareness campaigns can significantly reduce unclaimed dividends in the market. The NGX is committed to leveraging technology to enhance intermediaries and improve market access for retail investors. The establishment of a digital gateway has been initiated to democratize market access, eliminate obstacles, and foster more significant retail participation.

Chiemeka assured stakeholders that the SEC would continue working diligently to minimize cases of unclaimed dividends in the market.

Unclaimed dividends pose a significant challenge in the Nigerian capital market. By raising awareness and promoting financial literacy, investors can become better equipped to claim their dividends and benefit from their investments. The issue of unclaimed dividends not only affects individual investors but also has broader implications for the overall health and growth of the capital market.

With the rise of digital solutions and technological advancements, it is crucial to take advantage of these tools to simplify dividend processing and enhance investor knowledge. Financial institutions, regulatory bodies, and market operators must collaborate to develop innovative strategies to reduce unclaimed dividends.

Enhancing financial literacy should be a priority for all stakeholders, including the government, regulatory bodies, market operators, and financial institutions. By educating investors on the importance of monitoring and claiming dividends, unclaimed dividends can be minimized, leading to a more efficient and transparent market.

Investors should be encouraged to regularly check their investment portfolios and engage with their stockbrokers or registrars to ensure timely receipt of dividends. Additionally, investor education programs and campaigns can be conducted to create awareness about the process of claiming dividends and the consequences of unclaimed dividends.

Overall, the reduction of unclaimed dividends in the Nigerian capital market requires a multifaceted approach. Combining financial literacy initiatives, aggressive awareness campaigns, streamlined processes, and technological advancements can contribute to a healthier and more inclusive market environment.

Source of content: OOO News 2023-09-04 News

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