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Double Charges? Telecoms Mull Charging Bank Customers For USSD

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Double Charges? Telecoms Mull Charging Bank Customers For USSD

Punch Newspaper

Telecommunication operators may soon begin to charge bank customers’ airtime or data for Unstructured Supplementary Service Data transactions, The PUNCH has learnt.

This was due to a proposal from a Central Bank of Nigeria-led stakeholders’ forum organized to resolve the lingering billing and debt crisis between telecommunication companies and Deposit Money Banks in the country.

Banks and telcos have been in a running battle over N120bn USSD debts which the former has refused to pay over issues bothering on technical disagreements.

Earlier, the CBN Acting Director, Corporate Communication, Dr Abdulmumin Isa, had disclosed that the apex bank was intervening in the crisis.

He said, “The CBN is very much aware of the protracted dispute between the banks and telcos and has been engaging all stakeholders to ensure an amicable resolution.”

According to him, the direct intervention of the CBN in March 2021 has resulted in a per session price of N6.98 (including settling any outstanding fees) between the banks and telcos.

He added that the issue between banks and telecom operators was due to a technical crisis, which has led to high debt.

“As far as we are aware, since 2021, DMBs continue to collect the USSD fees and remit the same on behalf of the telcos based on that agreement.

“We understand the latest dispute concerns technical issues regarding the definition of a successful transaction from a bank and telco perspective.

“USSD fees are charged by DMBs using an automated system which bills the customer for a successful transaction only after a banking service is consumed. For the Telcos, a successful transaction happens once the customer has dialed the USSD short-code which may not lead to the consummation of banking service. Whilst such truncated transactions are not registered on the DMBs collection platform and thus not billed to bank customers, telcos expect the DMBs to charge customers once the short code is dialed, whether or not a financial transaction is consummated,” Isa said.

The Acting CBN director also disclosed that the CBN had proposed a direct billing model to allow telecom operators to have telcos full visibility of USSD transactions and allow them to charge their customers directly.

However, he added that the feasibility of the model was still being worked out by the relevant stakeholders.

When contacted by our correspondent on Tuesday for more information on the direct billing model, the Chairman of the Association of Licensed Telecoms Operators of Nigeria, Gbenga Adebayo, disclosed that the direct billing method would involve charges made through airtime or data.

He said, “The direct billing is end-user billing and that would be charging from the airtime or your data, and the bank will charge from the account.”

He, however, stressed that this method is not a resolution to the rising debt, which needs to be cleared.

“That is what they are talking about but that is not the issue. The issue we are talking about is the payment of the outstanding debt. Direct billing is for the future. No matter what billing method they adopt, it doesn’t deal with the outstanding,” he added.


The PUNCH observed that the debt owed by banks to telecom operators rose by 275 per cent from N32bn in 2019 to N120bn currently.

In an earlier report, the ALTON chairman disclosed that the operators had sought regulatory approval to implement partial removal of the USSD services.

He noted that the disconnection would be done in batches, starting with the highest debtor subject to final approval.

The NCC finally granted the approval recently, which will lead to a disruption of USSD services.

Speaking on Monday during the launch of the Financial Literacy e-Learning Platform, called ‘SabiMoni’, the CBN Governor, Godwin Emefiele, stressed the need to deepen the payment system infrastructure while addressing the issue between banks and telecom operators.

He said, “We will find that deepening the payment system infrastructure needed to be taken seriously and that is the reason you would have seen that between 2014 and even till now everything had been done to deepen our payment infrastructure through various mechanisms. At some point, we also said we will bring the telcos into it and then there was a tug-of-war between the banks about how they should share the income and of course, you have heard the story about USSD, which we are making a deliberate effort.”

He added that the apex bank would help to resolve the crisis because if it is not resolved, people will suffer.

“I am very certain that we are going to get to the end of it because if we do not resolve the problem, the people who will suffer when this kind of disagreement goes on will be those who are the users of the banking sector,” the CBN governor said.

According to Emefiele, the USSD has been very useful as a part of the mechanism for financial inclusion noting that he will not allow the services disrupted over the sharing of the income between banks and telecommunication companies.

The CBN governor also noted that one of the key drivers of financial inclusion is financial literacy, adding that “It is a prerequisite for greater financial inclusion, which would lead to the stability of the financial system and ultimately economic growth and development.”

In light of this, the apex bank launched the SabiMONI e-Learning Platform to provide a knowledge base for financial literacy.

Emefiele said, “The SabiMONI is a fully digital national e-learning platform that provides a knowledge base for financial literacy. It is aimed at providing individuals with the opportunity to be trained and to become Certified Financial Literacy Trainers through self-service. The platform is aimed at supporting our efforts towards ramping up the number of experts that can be used to drive financial education in the country and perhaps beyond.”

He added, “There is no gain saying the fact that the SabiMONI Financial Literacy e-Learning Platform will enable us drive financial education physically through the Certified Financial Literacy Trainers at the locations where it is most needed. It will enable us to drive Digital Financial Literacy thereby boosting consumer confidence in the uptake and utilization of Digital Financial Services.”

Also speaking at the launch of the platform, the Director of the Consumer Protection Department of the CBN, Mrs Rashida Monguno, said the platform seeks to improve the low financial literacy penetration currently standing at 64.1 per cent.

She added that the reason for the poor score may be due to a shortage of skilled financial literacy trainers and limited avenues or channels for financial education.

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