Last week, MTN Nigeria sent an sms to its customers saying that it would start charging N4 per 20 seconds on a unstructured supplementary service data (USSD) session. There was an uproar on Social media saying that this was a punitive measure and that it would not be accepted.
This caught the attention of Dr Isa Pantami, head of Nigerian Communications Commission, the regulator of the telcos. He then issued an instruction saying that the USSD charge should be suspended; and that he was not aware of this.
The telcos claim that the banks knew about this and that there was a discussion with the banks where the banks stated that they would no longer pay for the USSD service delivered to their customers and requested the telcos to charge customers directly for the use of the USSD channel.
Let’s back up a bit. A long time ago, the USSD channel was strictly a channel used for telco services such as balance inquiry and recharges. However over time, the channel evolved to being used for financial, agricultural and even government services among other services.
The banks then took advantage of this channel by pushing a lot of financial transactions through this channel. For this service, the telcos charged the banks access fees at a wholesale price. There was no separate charge passed onto the customer.
The banks claim that they did not agree with the telcos that this charge should be passed to the customer. In fact the bank’s CEOs applauded the decision by the NCC announcing the immediate suspension of end-user charges and thanked the federal government for championing the action.
According to them, when presented with two options by the telecommunications companies – corporate billing versus end-user billing, they had supported the standard practice for a relationship between a telecommunications company and their subscribers.
“We proposed the same method they charge for voice calls, SMS and data. We then asked to work with the telecommunications companies to bring the cost of their USSD service down for Nigerians.
“We were therefore very surprised at the announcements from MTN on the 19th and 20th October.”
Who should we believe? I am not an investigative journalist, but I am happy that it has been suspended.
Both parties have agreed to go back and discuss about the charge and hopefully, they can come up with a plan that will benefit all the stakeholders.
