SEC to launch mobile app to tackle N215bn unclaimed dividend in Nigeria’s capital market

The Securities and Exchange Commission (SEC) has said that it is setting up a special unit and developing a mobile application to address the pressing issue of unclaimed dividends in Nigeria’s capital market, which stood at a N215 billion as of March 2024.

The Director General of the SEC, Emomotimi Agama revealed this during the post-Capital Market Committee (CMC) press briefing on Thursday as part of the Commission’s broader strategy to safeguard investor interests and enhance market confidence.

Agama noted that while it was impossible to reduce unclaimed dividends to zero, the SEC is committed to ensuring that eligible investors can reclaim their funds with ease.

“We are going to set up a special unit at the SEC that speaks directly to the issues of unclaimed dividends. We discovered that a lot of investors are having some minor challenges in trying to get access to those unclaimed dividends,” Agama stated. He emphasized that the new unit will operate both at the SEC headquarters and at branch offices, providing a streamlined process for investors to recover their unclaimed dividends.

Agama further stated that the Commission was leveraging technology by developing a mobile app “that will be available on the Google Playstore and will grant investors real-time access to the amount of unclaimed dividends accrued to them and further simplify the process of reclaiming those funds.”

He revealed that the Commission would report progress to the Senate Committee within the next six months. He added that the SEC had also improved complaints management through the implementation of the Complaints Management Framework and the establishment of an Investor Protection Fund to restore investor confidence.

“To manage systemic risks, the SEC had mandated Capital Market Operators (CMOs) to prepare and submit their enterprise risk management frameworks and annual risk profiles to the Commission while also collaborating with other financial sector regulators and agencies in efforts to assist Nigeria in exiting the FATF grey list.”

While urging CMOs to ensure compliance with the Nigerian Sanctions Alert System and to enhance reporting on Politically Exposed Persons (PEPs) and Suspicious Transaction Reports (STRs), Agama also informed members of initiatives aimed at ensuring that the rulemaking process of the Commission becomes faster and more efficient.

“These include defragmenting the rules with a view of codifying the rules into a comprehensive rule book. Also, the Commission is presently updating rules on digital assets, has put in place guidelines for the banking recapitalisation exercise, as well as come up with guidelines for on boarding Virtual Assets Service Providers.

Furthermore, SEC is intensifying efforts to protect investors and promote the private bond market. The Commission is currently reviewing its rules on private bonds to ensure that the market remains robust and that investors’ interests are adequately safeguarded. This review follows the exposure of new rules to the market, with the SEC considering feedback from stakeholders to finalize regulations that will encourage capital formation and boost investor confidence.

Agama highlighted the importance of a secure and transparent market, saying, “The Commission is reviewing its rules on the private bond market as part of our commitment to capital formation and investor protection. We have received comments on the proposed rules, and we are working towards introducing a final focus that aligns with our objectives.”

He highlighted significant developments in the Nigerian capital market for 2024. According to him, the Commission has so far approved nine new issuances in the primary market totaling N1.228 trillion, reflecting increased confidence in the market.

“In the fund management space, the Net Asset Value (NAV) of Registered Mutual Funds grew by 111.08 per cent to N3.335 trillion, indicating a strong and sustainable growth.”

While giving assurance that the SEC was committed to the development of the market and the larger economy in line with President Bola Tinubu’s renewed hope initiative, he said, “It also important to know that the Commission will continue to encourage companies to list and urge exchanges to take steps to attract new listings to align with the government’s $1 trillion economy target.

“To further enhance our regulatory capacity, we have placed a new bill before the National Assembly aimed at strengthening our oversight functions. The bill, once passed, is expected to provide the SEC with expanded powers to address existing challenges in the market and ensure a progressive and functional environment for all participants. We are going to have a market that is resource-facilitating, supports capital formation, and prioritizes investor protection,” Agama affirmed.