…internet banking in Nigeria endangered
The future of internet banking in Nigeria appears to be under great peril as telecommunication companies threaten to deny banks the use of their platforms for money transfer.
Apprehension in the industry was hightened this week when the companies warned that they might to stop offering the Unstructured Supplementary Service Data (USSD), while accusing banks and the authorities of insincerity on the issue.
USSD is a Global System for Mobile(GSM) communication technology that is used to send text between a mobile phone and an application program in the network.
Speaking under the Association of Licensed Telecommunications Operators of Nigeria (ALTON), they expressed dismay at the silence and inaction of key stakeholders, including the Central Bank of Nigeria (CBN), Nigeria Communications Commission (NCC) and Body of Bank Chief Executive Officers (CEOs).
They also excoriated the role of Communications and Digital Economy Minister, Dr Ali Pantani, who issued a ‘directive’ to stop them from charging for the services they offer to the financial institutions.
Addressing a world press conference towards the group’s 20th anniversary, Chairman of ALTON, Gbenga Adebayo, challenged the argument that the cost of providing the services was ‘sunk’. He wondred if the cost of building a house could be described as ‘sunk’.
Adebayo said the companies invested huge cash to put the infrastructure in place, adding that they have been spending money to keep the base transceiver stations (BTS) running, in addition to other costs.
Adebayo said the operators will soon apply the relevant sections of the Nigerian Communications Act to stop providing links to the banks.
The operators, especially MTN, had stopped the implementation of the N4 charge per 20 seconds for every USSD access to banking services, following the public outcry and subsequent directive from Dr. Pantami.
The carriers insisted that stakeholders are yet to meet to discuss the way forward, “but the banks have continued to charge as much as N55 per transaction, using the same telecoms operators platform.”
Adebayo, while sharing the success story of the industry in the last 20 years, said the industry will not offer USSD services free of charge.
He stressed that the USSD cost was never a sunk cost as championed by the CBN, it is an infrastructure, which the operators have invested so much in the last one decade.
Adebayo said: “I am saying it again that the USSD links will not be offered free of charge. The records are there. We are tracking how much the banks are charging and making on the USSD. When the time comes, and we agree on way forward, we will show them what they have been charging. For the telcos, it cost them so much to provide the service.
“What should have happened is that when we first raised this issue, we made public statement and expected that a stakeholders meeting should have been called to discuss the matter.
“The CBN governor spoke, Minister of Communications and Digital Economy spoke, the NCC withdrew; and since then, nobody has said anything. We expected that a meeting of minds, where all parties (telcos and the banks) would come and talk on the matter to a find a lasting solution, but nothing of such. I am saying it again; we cannot bury this matter under the table and wish it goes away, it won’t go away. The fact is those links won’t be provided at no cost.
“When the time comes, we shall treat it as interconnect debt. We shall invoke the right of the provider of service under the Act of the NCC. So, if the banks will continue to enjoy the service and they won’t pay, telcos will make a case to the NCC for proper disconnect.”
