Investing in the stock market is often described as a patient man’s game—a long-term strategy for building wealth. In Nigeria, as elsewhere, investors put their money into shares hoping for two forms of reward: capital appreciation when share prices rise, and dividends paid out from company profits. For many, it’s meant to be a steady path to financial security.
But there’s a persistent shadow hanging over the Nigerian capital market: the stubborn, recurring problem of unclaimed dividends. Year after year, billions of naira in declared dividends remain uncollected, sitting idle in accounts instead of rewarding the investors who earned them. For retail shareholders, especially those who depend on these payouts for household income, the frustration is real.
And more often than not, the anger is directed squarely at registrars, the entities tasked with maintaining shareholder records and disbursing dividends. It’s an easy target. But like many easy answers, it’s misleading. The truth is far more complex and far more systemic.
Why Dividends Go Unclaimed
The reasons dividends remain unclaimed go beyond registrar inefficiency. Many are rooted in the habits and practices of the investing public, gaps in market infrastructure, and bottlenecks involving several players in the capital market value chain.
Some of the most common causes include: Multiple accounts in different names or pseudonyms. An investor might buy shares through various stockbrokers, using slightly different name spellings or completely different identifiers.
There is also the issue of outdated bank details or contact information. Some investors haven’t updated their records since the 1990s, when physical share certificates were the norm. The list also includes what can be described as estate complications after death. Heirs often face long legal battles to prove ownership before they can access a deceased shareholder’s dividends.
Operators also cite the problem of Delays in bank validation. Even when shareholders complete e‑dividend forms, banks can take weeks or months to confirm the details.
Another challenge is investor ignorance. This is because many simply don’t know how to lodge a claim, or they assume it will happen automatically.
So yes, registrars are part of the picture, but they are far from the whole story. The process involves stockbrokers, issuing companies, banks, and regulators, all of whom have a role to play.
Identity Checks Are Not “Delay Tactics”
One of the most frequently criticised aspects of dividend claims is the sometimes lengthy identity verification process. Investors often complain that registrars hide behind bureaucracy, using endless checks as an excuse for slow service.
But in reality, registrars have a legal and fiduciary duty to ensure that dividend payments go to the rightful owners. In a country where identity theft, fraud, and impersonation are real threats, these checks are not optional, they are essential.
Registrars rely on tools such as the Bank Verification Number (BVN), the National Identity Number (NIN), and signature verification to confirm a claimant’s identity. These aren’t arbitrary hurdles; they are part of risk management and regulatory compliance. Paying the wrong person is a liability no registrar can afford, and no investor would want if the tables were turned.
The Push Toward Digital Transformation
There’s also a perception that registrars are old-fashioned, resistant to change, and stuck in the paper-based past. That may have been true years ago, but the picture is changing.
Many registrars have rolled out digital platforms that allow investors to: Submit e-dividend mandates online; View their dividend history in real time; Request revalidation of payments, and update personal details securely.
The challenge often lies not with the technology itself, but with the quality of the data fed into it. Incomplete forms, inconsistent information, and outdated shareholder records remain the biggest stumbling blocks. Add to that poor internet access in some parts of the country and low digital literacy among older shareholders, and the road to full digital adoption becomes even steeper.
Limitations Beyond the Registrar’s Control
Some dividend delays are simply not in the registrar’s hands. If shareholders supply incorrect data or if banks are slow in validating mandates, the registrar cannot move the process forward. In many cases, investors fail to follow up after submitting their forms, leaving the process hanging.
Even when shareholders walk into registrar offices with documents in hand, delays can persist if those documents are incomplete or if the shares in question are tied to legacy paper-based systems dating back decades.
The Role of Regulators and the Gaps That Remain
The Securities and Exchange Commission (SEC) has not been blind to the issue. It has issued circulars, introduced the Unclaimed Funds Trust Fund, and set out guidelines for e-dividend registration. But there’s still room for stronger enforcement and clearer dispute‑resolution mechanisms.
The SEC could help by setting minimum response time standards for handling investor complaints and creating a user-friendly digital complaint portal. The commission could also roll out targeted financial literacy programs, especially for low-literacy or elderly shareholders. It can also impose sanctions on all stakeholders, banks, brokers, and registrars when they fail to meet their obligations. SEC can also develop a unified identity system for the capital market to streamline Know‑Your‑Customer processes.
Investors Have Responsibilities Too
It’s easy to see investors as the victims in this story, but they are also part of the solution. Many have never updated their contact or bank details since they first bought shares, sometimes decades ago. Some still hold outdated physical share certificates.
Others ignore repeated calls to complete e‑dividend mandates or attend investor education sessions. Registrars, stockbrokers, and the SEC often hold clinics, run awareness campaigns, and set up help desks at Annual General Meetings. Yet turnout remains disappointingly low.
Without a stronger culture of financial literacy, many investors will continue to lose out—not because the system is rigged against them, but because they are not actively engaging with it.
Collaboration, Not Condemnation
The unclaimed dividend problem is not unique to Nigeria. Even in advanced markets, unclaimed funds exist. The difference is in how each market manages the issue. In Nigeria, solving it will require a multi-pronged, collaborative approach—not a blame game.
Registrars are not the enemy; they are facilitators working within a system that needs improvement at multiple points. The focus should be on: automation to reduce manual bottlenecks, investor education to raise awareness, better regulation to enforce standards, and cross-stakeholder cooperation to align processes.
When every link in the chain—from regulators to registrars, from brokers to banks, and from companies to investors—pulls in the same direction, the capital market will not only reduce the stockpile of unclaimed dividends but also rebuild investor trust.
The Bottom Line
At its heart, the unclaimed dividend crisis is a test of Nigeria’s ability to build a modern, inclusive, and credible capital market. Investors need confidence that when they buy into a company, their returns will reach them without unnecessary hurdles. That confidence is built not just on rules, but on working systems, proactive communication, and a culture of shared responsibility.
It’s time to move past finger-pointing. The problem is bigger than any one stakeholder, and so is the solution.
*Eborah is the Registrar/Chief Executive, Institute of Capital Markets Registrars
