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E-dividend mandate’ll reduce unclaimed dividend – Shareholders

By BusinessNews Staff on May 5, 2015

Electronic Dividend (e-dividend) was introduced to forestall the rising incidence of unclaimed dividend in the Nigerian Capital Market. Shareholders who spoke with Vanguard Investors Forum, explains how e-dividend work and its benefits over paper dividend.
Excerpts:
Mr. Bello Olowonikoko, Nigerian Shareholder’s Solidarity Association: E- dividend mandate is a mandate form that registrars issue to investors to complete and take it to their bank for verification of their signature. Thereafter, the investor will submit the form back to the registrar concerned for execution. The e-dividend helps to reduce a lot of unclaimed dividend, and that is the one advantages.
Remember, some shareholders have been shouting that they don’t get their dividend, one of the reasons is that when they change their place of residence without notifying their registrar, they cannot get the dividend warrant because the registrar would have posted it to their former address.
But with the e- dividend mandate, the moment the e-mandate form is filled and signed by the bank after verification and returned to the registrar for implementation once dividend is declared by a comapny, the registrar will just post the dividend acrued to a shareholder directly into his bank account.
Do all registrars in Nigeria issue e-mandate form to shareholders?
Most registrars issue e- mandate form. When you go through annual report, there are pages where e-mandate warrants are attached . There are two of them, one for bonus and the other for dividend . If there is any bonus approved at AGM , instead of sending them paper certificate that majority may not even receive due to non-notification of address change, the registrar will automatically transfer their bonus into their Central Securities Clearing System, CSCS statement of account the moment the shareholders complete the form.
National Coordinator of Proactive Shareholders Association of Nigeria, Mr. Taiwo Oderinde:
e-mandate dividend is an electronic means of posting shareholders dividend directly into his or her bank account . It is for people who have mandated the registrar to pay their dividend into their bank account by completing the e-mandate form . e-dividend mandate is a kind of instruction from the investor to the registrar. It is usually attached to the back of the annual report. By completing the form you are mandating the registrar to stop paying you physical dividend but to credit your dividend directly into your bank account. It has to do with electronic crediting. It is the best, immediately your account is credited, you will receive alert that you have been paid. Unlike physical dividend, e-dividend cannot be stolen, misplaced, lost or destroyed by fire or water.

[Vanguard]

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