The Central Bank of Nigeria opposes MTN’s plan to impose charges for unstructured supplementary service data (USSD) transactions.
Effective Oct 21st, the South African owned MTN, has under the guise of Nigerian banks, put forward a charge of N4 per 20 seconds on USSD transactions made by customers for both inter and intra bank services.
Starting from October 21, MTN "will charge N4 per 20 seconds for USSD access to banking services as requested by your bank."
USSD was supposed to be the cheapest and easiest way to access banking services. Not anymore. pic.twitter.com/BwvdDiQtPG
— IA's Talkspace (@IAtalkspace) October 20, 2019
According to News Agency of Nigeria, MTN, in an SMS message to its subscribers, had said the decision was on the request of the banks and would take effect from October 21.
“Yello, as requested by your bank, from October 21, we will start charging you directly for USSD access to banking services.
“Please, contact your bank for more info,’’ the message said.
However, reacting to the announcement, the CBN governor, Mr. Godwin Emefiele, gave the bank’s position at a news briefing by the Nigerian delegation to the just-concluded World Bank/IMF Annual Meetings, in Washington on Sunday.
He had “I have told the banks that we will not allow this to happen.”
Emefiele reiterated how he was in a meeting, about four to five months ago, with the telcos and leading banks in Nigeria over not placing of charges on USSD transactions, as the use of USSD for transactions was meant to be a sunk cost.
“At that time, we came to a conclusion that the use of USSD is a sunk cost.
“What we mean by a sunk cost is that it is not an additional cost on the infrastructure of the telecom company.
However, the telecos companies disagreed with them. Saying, it was an additional investment on infrastructure and for that reason, they needed to impose it.
“But the telecom companies disagreed with us. They said it was an additional investment on infrastructure and for that reason, they needed to impose it.
He concluded that “The banks are the people who give this business to the telecom companies and I leave the banks and the telecom companies to engage.
“I have told the banks that they have to move their business, move their traffic to a telecom company that is ready to provide it at the lowest possible, if not zero cost.
CBN has therefore suspended implementation of such decree until further notice.
Meanwhile, USSD transactions incur on customers between 10 to 15 Naira cost per transaction like checking of account balance.
How much does your bank charge you for transactions. List them?