ISLAMABAD: Taking another step towards facilitating minority shareholders, the Securities and Exchange Commission of Pakistan (SECP) has proposed reducing turnaround time for payment of cash dividend to shareholders of listed companies from the existing 15 days to 3 working days only.
The SECP has issued draft amendments to Companies (Distribution of Dividends) Regulations, 2017 to solicit public comments.
“The SECP believes that the proposed time period of three working days is sufficient for transfer of cash dividend from a company’s bank account to the bank accounts of their respective shareholders,” the commission said in a statement.
The Section 242 of the Companies Act, 2017 requires every listed company to pay cash dividend only through electronic mode directly into the designated bank accounts of a shareholder. Since transfer of cash dividend through IBANs is safe, cost effective and efficient, all shareholders are required to provide their IBANs to their respective companies, for making payment of cash dividends.
“The draft amendments are available on the SECP website and the interested individuals/stakeholders can furnish comments by March 8, 2021,” the statement read.