Shareholders will smile this week as companies pay $7 billion into bank accounts and super funds.

Economists and analysts say it has the potential to boost consumer spending, and also shows that corporate Australia is still making good money despite a few high-profile company woes.

The Commonwealth Bank alone will hand out about $3.8 billion in dividends on Thursday, while other big payers for the week include Medibank, Woodside Petroleum, QBE Insurance, Caltex and Ramsay Health Care.

CommSec chief economist Craig James said large dividend payouts made people feel wealthier, and the extra dollars could potentially lift spending.

The dividend payout has the potential to boost consumer spending. Picture: Supplied.Source:Supplied

“Right across Australia people are seeing those dollars in their accounts. Some people will say ‘you beauty, I have some extra money to spend’,” he said.

“If you were in retail or any other business, it represents an opportunity to market your goods.

“People get their dividends in different ways — some get it electronically and some a cheque in the mail. Others have signed up for a dividend reinvestment scheme.”

Super funds also receive a large slice of company dividends and reinvest the money into more shares for members.

Mr James said this week’s payout was part of a $24 billion dividend windfall between late August and late November, following the recent profit reporting season when more than two-thirds of companies increased their profit.

“I think a lot of people found it surprising that most companies did report a profit and a majority are paying a dividend,” Mr James said.

For many, some high-profile poor profits and dividend cuts by corporate giants such as Woolworths and BHP Billiton overshadowed improvements by other companies.

Baker Young Stockbrokers managed portfolio analyst Toby Grimm said while overall company profits were in line with expectations, dividends were better than expected.

“It shows that companies understand that shareholders are very focused on dividends,” he said.

Mr Grimm said the sharemarket overall was paying a dividend yield of 4.44 per cent, or almost 6 per cent when tax credits were included.

“In the absence of an earnings shock, and one isn’t expected, it’s likely that the market will continue to offer a reasonable dividend yield well above what you would get from lower-risk assets such as bonds and cash,” he said.

“The earnings outlook is for growth. I think dividends are safe for now.”

BIG DIVIDENDS TO BE PAID

Sonic Healthcare 44c September 27

Medibank Private 6c September 28

QBE Insurance 21c September 28

The Commonwealth Bank $2.22 September 29

Ramsay Health Care 72c September 29

Bendigo Adelaide Bank 34c September 30

Woodside Petroleum 45c September 30

Caltex 50c September 30

Wesfarmers 95c October 5

Woolworths 33c October 7

AMP 14c October 7

Qantas Airways 7c October 12