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eBusiness Life Magazine > Blog > NewsBytes > ALTON Set To Disconnect Debtor Banks’ USSD Service, As NCC Gives Approval
NewsBytes

ALTON Set To Disconnect Debtor Banks’ USSD Service, As NCC Gives Approval

ELadmin1
Last updated: 2023/05/14 at 7:05 AM
By ELadmin1
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The Nigerian Communications Commission (NCC) has given approval to Mobile Network Operators to disconnect Deposit Money Banks (DMBs) over failure to pay the debt owed to operators for Unstructured Supplementary Service Data (USSD) services which amount to over N120 billion.

The Association of Licensed Telecommunications Operators of Nigeria (ALTON), who disclosed this today in a statement stated that the approval was granted because, despite multiparty stakeholder efforts to resolve the situation and prevent any impact on services, the affected DMBs have continued to incur greater and greater debt, without making the commensurate payments.

The statement jointly signed by ALTON Chairman, Engr. Gbenga Adebayo and Head, Operations, Gbolahan Awonuga, mentioned that the Minister of Communication and Digital Economy, Prof. Isa Pantami, the NCC, and the Central Bank of Nigeria, along with MNOs and DMBs to have intervened by failed.

“The Association of Licensed Telecommunications Operators of Nigeria (ALTON) wishes to inform the Nigerian Public that the Nigerian Communications Commission (NCC) has granted approval for our members – Mobile Network Operators (MNOs) – to disconnect Deposit Money Banks (DMBs) if they fail to pay the debt owed to Operators for Unstructured Supplementary Service Data (USSD) services which amount to over N120 Billion,” the statement reads.

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It added that every time some progress is made, the DMBs come up with reasons to take stakeholders several steps back, in this matter.

The Association recalled 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 stands at over N120 Billion).

“Due to the inability of MNOs and DMBs to reach an agreement on the issues, MNOs in 2021 sought to disconnect DMBs due to the unpaid debts which stood at N42 Billion as at that time. However, the Minister of Communication and Digital Economy, Prof. Isa Pantami intervened and asked the MNOs not to disconnect DMBs as the action will negatively impact on the Digital and Financial Inclusion policy of the Federal Government.”

The statement further noted that the NCC, ALTON, the Association of Telecommunications Companies of Nigeria (ATCON) and Deposit Money Banks (DMB) represented by the Chairman, Body of Bank CEOs subsequently met on March 15 2021 to discuss indebtedness of DMBs to MNOs for USSD services.

Further to the meeting, CBN and NCC issued a joint press statement on the agreement reached by all stakeholders (link: https://ncc.gov.ng/media-centre/news-headlines/969-joint-statement-by-central-bank-of-nigeria-nigerian-communications-commission-on-pricing-of-unstructured-supplementary-service-data-ussd-services ).

ALTON also noted that in a bid to douse the tension and in national interest, the Minister of Communications and Digital Economy, Prof. Pantami and the Nigerian Communications Commission (NCC) have made several efforts to get the banks to show good faith and sign an agreement, based on the resolutions reached at that meeting, to no avail. “Unfortunately, the patriotic intervention of the Hon. 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.”

“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.

MNOs have invested billions of naira in expanding their systems to accommodate the USSD needs of DMBs over the years. This has resulted in more Nigerians having access to banking services in addition to enabling banks to trim down 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 N42 Billion in 2021 has now risen to over N120 Billion.

It is obvious that the level of debt is unsustainable given the time/value huge cost of the continuous upgrade and operation of the systems and infrastructure dedicated to supporting USSD transactions of DMBs,” the ALTON Statement concluded.

ELadmin1 May 14, 2023 May 14, 2023
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