Tuesday , December 7 2021

Communications Minister, CBN, MTN disagree over USSD service charge

MTN Nigeria has announced that customers who use unstructured supplementary service data (USSD) channels to access banking services would have to pay new charges from October 21.

This was contained in the notifications sent out by the telco yesterday to its customers in Nigeria.

According to the telco, the service charge will be N4 per 20 seconds for USSD access to any banking services.

The transactions to be affected by the charges include intra- and inter-bank money transfers, checking of account balance through USSD, among others.

What this means is that for every minutes spent using USSD code, MTNN would charge N12 depending on how fast the network respond.

Business Remarks observed that there is a tendency the charges goes higher than that, if the network fails per session.

Our source who declared anonymity said the banks charges has always been remitted to the telcos but now they wants the telcos to charge separately.

“This development is not peculiar to MTN, other telcos will start charging as well as from today. MTNN just decided to carry their customers along by informing them earlier”, the anonymous said.

Recall, USSD use to be the best available communications technology to deliver mobile financial services to low-income customers, but with the new development it is possible that this will go against the CBN’s objective of promoting financial inclusion, as well as against NCC’s affordability aspect of digital inclusion.

However, this did not go down well with the Central Bank of Nigeria and the Federal Ministry of Communications.

In a statement signed by the Spokeperson to the Minister of Communications, Mrs Uwa Suleiman stated that the plan by the telco to commence the USSD service charge today must be suspended.

The Communications Minister, Dr Isa Ali Ibrahim Pantami decried such move, noting that the Ministry is unaware of the development.

“The attention of the Federal Ministry of Communications has been drawn to the viral text message allegedly sent by the Mobile Network Operator MTN Nigeria and other Mobile Operators notifying subscribers of a four naira (N4:00) charge per 20 seconds on USSD access to banking services from the 21st of October 2019.

“The office of the Honourable Minister of Communications Dr Isa Ali Ibrahim Pantami FNCS, FBCS, FIIM is unaware of this development and has hereby directed the sector regulator, the Nigerian Communications Commission (NCC) ensures the operator suspends such plans until the Honourable Minister is fully and properly briefed”, he ordered.

On his part, the Governor of Central bank of Nigeria, Mr. Godwin Emefiele stated that the MTN Nigeria cannot go ahead with the move, otherwise risks losing the business in all.

According to him, the use of USSD is a sunk cost with no additional cost on the infrastructure of the telecom company.

Emefiele added that the deliberations on this issue has been ongoing for the past five months with no reached agreement from the both sides.

“About five, four months ago, I held a meeting with some telecom companies as well as the leading banks in Nigeria at Central Bank, Lagos.

“At that time, we came to a conclusion that the use of USSD is a sunk cost.

“What we mean by a sunk cost is that it is not an additional cost on the infrastructure of the telecom company.

“But the telecom companies disagreed with us. They said it was an additional investment on infrastructure and for that reason, they needed to impose it.

“I have told the banks that we will not allow this to happen.

“The banks are the people who give this business to the telecom companies and I leave the banks and the telecom companies to engage.

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“I have told the banks that they have to move their business, move their traffic to a telecom company that is ready to provide it at the lowest possible, if not zero cost.

“And that is where we stand, and we must achieve it,’’ he gave the bank’s position.

Already, the development has elicited reactions from customers and they have taken to social media to express how they feel on social media.

USSD service charge






Also, one of the subscriber, Mr Ogbuefi Okafor with the twitter handle @MistaChika said he has been getting USSD service from Stanbic IBTC bank for long which has discouraged him from using the code.

About Bukola Olanrewaju

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