By Sahabi Abdul
There’s a surge of Nigerian investors seeking to obtain their unclaimed dividends at the offices of companies registrars ahead of the government move to borrow the funds.
Registrars including First Registrars, Africa Prudentials and Cardinal Stone saw a doubling of clients at their offices in Lagos and Abuja since the beginning of the week with inquiries about steps to take to retrieve unclaimed dividends, investigations by our reporters showed.
Under the 2021 Finance Act signed into law by President Muhammadu Buhari on December 31, 850 billion naira of unclaimed dividends and funds in dormant bank accounts will be moved to a special trust fund, from which it can be borrowed by the government. Funds will be returned to those who subsequently establish their ownership, according to the law.
“I’m worried by the borrowing habits of this government, ” said Ben Ebiowei, an Abuja-based businessman who was at First Registrars for the required paperwork for his outstanding dividends. “I want to get my money first before they get hold of it as they seem intent on spending everything. “
A number of clients were there as well to make inquiries on behalf of their relations in the diaspora. At the office of Africa Prudential in Lagos, Emmanuel Azi, who came to update the account of a U.S.-based relation, was told it wasn’t possible.
“We need the account owner to be physically present for signature and identity verification, ” an official told Azi.
Others who came to regularize the accounts of deceased people were advised on the required probate processes for the transfer of ownership.
Declining oil revenue since 2015, made worse by the coronavirus pandemic, has forced the government to rely more on borrowing to fund its expenses.
Nigeria’s total public debt as at the end of September stood at 84.6 billion dollars, with domestic accounting for 62 percent of the total, according to the Debt Management Office. Total external debt was at $31.9 billion, comprising entirely of federal government borrowing.
For the 2021 budget year, the government plans to shun foreign borrowing, Finance Minister Zainab Ahmed said last week. Instead the government will take advantage of prevailing low domestic interest rates to borrow locally, while tapping other sources such as unclaimed dividends and dormant bank accounts.