Rules shake-up as investors abandon Sh30bn dividends
The Unclaimed Financial Assets Authority (UFAA) in Kenya is proposing policy changes to extend the dormancy period for unclaimed dividends from three to five years. This move aims to give companies more time to locate rightful owners before assets are declared abandoned.
Why it matters
The initiative seeks to improve the reunification of billions of shillings in unclaimed assets with their original investors, boosting financial inclusion.
The Unclaimed Financial Assets Authority (UFAA) has lined up a raft of policy changes, including a reduction of penalties and the extension of the dormancy period, in a bid to unlock Sh30.5 billion in unclaimed dividends for investors in saccos and Nairobi Securities Exchange-listed firms.
Proposals by UFAA, seen by the Business Daily, seek to extend the time listed companies and saccos have to look for the rightful owners of dividends by two years before such assets can be declared abandoned and handed over to the agency.
The Unclaimed Financial Assets (Amendment) Bill proposes that shares and dividends be presumed abandoned after five years, up from the current three years.
Dividends are deemed abandoned when payouts fail to reach intended owners due to outdated contact details, uncashed physical cheques, or inactive bank accounts.
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