Nigerian mobile telecommunications companies consisting of MTN, Glo, Airtel, and 9mobile, are set to disconnect bank customers as they have secured the approval of the Nigerian Communications Commission.
According to a statement issued by the association and signed by Chairman, Gbenga Adebayo, recently, the authorisation to disconnect Deposit Money Banks is due to the refusal to pay the debt owed to operators for Unstructured Supplementary Service Data services, to the tune of N120bn.
“Members of the public will recall that MNOs and DMBs have had protracted disagreements concerning the appropriate USSD pricing model for financial transactions, transparency of charges, mode of collection, and liability for payment of the outstanding and continuous service fees due to the MNOs (which currently stand at over N120 billion).”
The operators under the aegis of the Association of Licensed Telecoms Operators of Nigeria said that with the NCC’s approval, banks will be disconnected if they fail to pay up.
Following the debt problem ALTON explained that despite stakeholder efforts to resolve this situation and prevent any impact on services, led by the Minister of Communication and Digital Economy, Prof. Isa Ali Pantami, and including the NCC, the Central Bank of Nigeria, and MNOs and DMBs.
The banks refused to cooperate with the telecom operators over the payment of the debt. It noted that The DMBs have continually incurred debt, without efforts to settle previous payments.
Prior to making this decision, ALTON said in 2021 DMBs incurred a N42bn debt which the MNOs planned to take action on.
However, interventions from the Minister of Communication and Digital Economy, Prof. Pantami, discouraged the MNOs stating that the action would negatively impact the Digital and Financial Inclusion policy of the Federal Government.
“The Nigerian Communications Commission, Association of Licensed Telecoms Operators of Nigeria, Association of Telecommunications Companies of Nigeria and Deposit Money Banks represented by the Chairman, Body of Bank CEOs subsequently met on 15 March 2021 to discuss indebtedness of DMBs to MNOs for USSD services.
In that regard, CBN and NCC issued a joint press statement on the agreement reached by all stakeholders.
“The Honourable Minister of Communications and Digital Economy and the NCC have made several efforts to get the banks to show good faith and sign an agreement, in the national interest, based on the resolutions reached that meeting.
“Unfortunately, the patriotic intervention of the Minister and the NCC have been taken for granted by the DMBs, as two years after, the banks have failed to sign a final agreement,” ALTON explained.
“It is pertinent to note that the contract between MNOs and DMBs on the use of USSDs for banking transactions is strictly commercial and MNOs are at liberty to withdraw the services if it is established that the transaction is unprofitable to them.
ALTON highlighted that the MNOs had invested billions of naira in expanding its systems to accommodate the USSD needs of DMBs over the years.
Which has allowed Nigerians seamless access to banking services,” in addition to enabling banks to trim costs by requiring fewer branches to service their growing customers. Unfortunately, MNOs are not getting paid for their services, and the debt that stood at N42bn in 2021 has now risen to over N120bn,” the telcos added.
Operators opined that the current debt level was exorbitant taking into consideration of ongoing upgrades and operation of the systems and infrastructure dedicated to supporting USSD transactions for DMBs