The conflict between Nigerian banks and mobile network operators over Unstructured Supplementary Data Services (USSD)’s charges has been resolved by the regulators of both telecom and banking sectors.

Money Deposit Banks and Mobile Network Operators had been on loggerhead over transaction fees for long. Last week, telcos announced they were going to cut the USSD service off from their platforms, prompting the intervention of the sector’s regulators, the Central Bank of Nigeria and the Ministry of Communication and Digital Economy.

A statement issued by the regulators after an impromptu meeting the regulators held on Monday said the issue has been resolved, and a new framework is being developed to prevent such happenings in the future.

The resolution reached by the stakeholders of the industries who graced the meeting prohibits banks from imposing additional charges on USSD users, and directed that henceforth, all USSD sessions will be charged at a flat fee of N6.98 per transaction. It said that the new USSD charges will hence be collected on behalf of MNOs directly from customers’ bank accounts.

The regulators said talks are ongoing to resolve the issue of N42 billion debt between the banks and telcos.

The statement signed by CBN (Central Bank of Nigeria)’s Acting Director Corporate Communications Osita Nwanisobi, and NCC (Nigerian Communications Commission)’s Director, Public Affairs, Dr. Ikechukwu Adinde reads thus:

Mobile Network Operators (MNOs) and Deposit Money Banks (DMBs) have had protracted disagreements concerning the appropriate USSD pricing model for financial transactions. This resulted in the accumulation of outstanding fees for USSD services rendered leading to potential service withdrawal by MNOs.

USSD is a critical channel for delivering financial services, particularly for the underserved and for financially excluded. To resolve the lingering dispute and ensure uninterrupted services to customers on the channel, the Honourable Minister for Communication and Digital Economy on March 15, 2021 chaired a meeting of key stakeholders to discuss an amicable resolution in the interest of the general public.

Represented at the meeting were the various MNOs, Association of Licensed Telecom Operators of Nigeria (ALTON), Association of Telecommunications Companies of Nigeria (ATCON), DMBs (represented by the Chairman, Body of Bank CEOs) and the sector regulators – Central Bank of Nigeria (CBN) and Nigerian Communications Commission (NCC).

We are pleased to announce that after comprehensive deliberations on the key issues, a resolution framework acceptable to all parties was agreed thus:

1. Effective March 15, 2021, USSD services for financial transactions conducted at DMBs and all CBN-licensed institutions will be charged at a flat fee of N6.98 per transaction. This replaces the current per session billing structure, ensuring a much cheaper average cost for customers to enhance financial inclusion. This approach is transparent and will ensure the amount remains the same, regardless of the number of sessions per transaction.
2. To promote transparency in its administration, the new USSD charges will be collected on behalf of MNOs directly from customers’ bank accounts. Banks shall not impose additional charges on customers for use of the USSD channel.
3. A settlement plan for outstanding payment incurred for USSD services, previously rendered by the MNOs, is being worked out by all parties in a bid to ensure that the matter is fully resolved.
4. MNOs and DMBs shall discuss and agree on the operational modalities for the implementation of the new USSD pricing framework, including sharing of Application Programme Interface (API) to enable seamless, direct and transparent customer billing.
5. DMBs and MNOs are committed to engaging further on strategies to lower cost and enhance access to financial services.
6. With the above resolution, the impending suspension of DMBs from the USSD channels is hereby vacated. Therefore, DMBs shall no longer be disconnected from the USSD channel.

The general public should be reminded that USSD is optional, as several alternative channels such as mobile apps, internet banking and ATMs may be used for financial transactions.

The CBN and NCC shall continue to engage relevant operators and all stakeholders to promote cheaper, seamless access to mobile and financial services for all Nigerians.

US payment giant, Stripe, adds Africa via its acquisition of Paystack, in its books, and hits a new valuation: $95 billion. These things always work: Amazon puts in say $2 billion in India, and Wall Street adds a valuation of $20 billion for the Indian exposure. My model is that Stripe’s $200M voyage in Africa via Paystack might have added at least $3 billion in its latest valuation!

Stripe, which builds economic infrastructure for the internet, announced on Sunday it has raised a $600 million funding round that puts its valuation at $95 billion.

The round was graced by many investors, including Allianz X, Axa, Baillie Gifford, Fidelity Management & Research Company, Sequoia Capital, and Ireland’s National Treasury Management Agency (NTMA).

The $600 million round has put the payment company above SpaceX and Instacart, whose valuation is placed at $74 billion and $39 billion respectively. Stripe has thus become the most valuable private company in Silicon Valley.

Paystack’s Parent, Stripe, Raises $600m In A Fresh Round to Reach $95bn Valuation

Stripe Acquires Nigeria’s Paystack for More than $200 Million

“Life lessons are everywhere, if we would but stop, look and reflect.”

This is a quote from Life Lessons from Ants by Liz Taylor. Being bitten by an ant, she paused and reflected on the capacity, courage, and constancy of ants. Like her, I am about to share an interesting story with you as told by my brother, Alfred, about a dog and her litter when he sojourned in the City of Zaria. I reflected on this and discovered a perfect similitude in behavior of these animals and man in his quest to grow his wealth.

One evening I laid on the sofa reflecting over my interaction with a prospective investor earlier in the day. She wanted to invest a certain amount of money that she felt the returns I offered weren’t that good. She had spent her day moving from one bank to another in search of a high interest yielding account to invest in but found none. “I will keep searching and if I can’t find an option better than yours I will contact you,” she said. It was at this moment the story of the cautious puppy popped up in my head. I had to call Alfred to share the story one more time because of the great financial lessons we can learn from it.

Alfred: “There was this beautiful dog that strayed into the compound I lived in and made it her home. I fed and cared for her. She had a shiny white hair coat with black spots. Neighbors thought I always bathed her. She had her first litter of puppies that were taken away by thieves. Then she had another litter of six puppies. These puppies despite being unable to see as they were just a few days old were so restless except Patty. I named all of them and built a house for them to restrain their wanderings and protect them from danger all around. Every time I returned from work I would find them in a nearby bush and in different corners around the compound. What amazed me was that their eyes were still not opened but they kept moving blindly.

Patty was unlike the rest. She was always sleeping, even when she started seeing she only moved when the mother was around and never came out in her absence. She never responded to the voices of strangers nor accepted food from them. She was very intelligent like the mother. Not surprising she became the only survivor and grew to the size of the mother. One of the puppies due to its curiosity died with its head trapped in some place, a neighbor sold one in my absence and the rest got stolen by thieves. Patty grew into a beautiful dog before I left Zaria. Her carefulness saved her life.”

The Dog and Her Golden Pups

Now, let us take the mother dog to be our golden stream of income that we divest in our bid to create wealth. For an employee, this comprises his salary, bonus, annual leave allowance, 13th month, etc. For a business person, it is revenue and profit. Her pups were precious to her but they had their lives in their hands. The mom gave them instructions before she goes out in search of food daily. If we could decode her barks, growls, whining, and howls to her pups, we would hear her say something like: “Don’t leave house. Stay together. You know your eyes are not yet opened; it’s a dangerous world out there. I will be back soon. I love you all. Be safe!” Somehow, it happened that only Patty kept the mom’s instructions everyday while her siblings were always lured by the exciting and dangerous world. Unfortunately, the restless pups were lost forever.

Conclusion: Diversifying into a more predictable, stable, and less risky investment.

This is the point in this entire story. Not putting all your eggs in a single basket of very risky investments. There are a thousand and one investment opportunities out there promising unbelievable returns with concealed equal chances of loss. This is apparent with the pups that were so restless, roving to their unfortunate fate. If given these ten investment options: fixed deposits, crypto currency, treasury bill, stock market, mutual funds, trade financing, crowdfunding, micro lending, agric business, and angel investment to invest in, I bet, if at all, treasury bill and fixed deposit will be the least attractive to you. But they could be your Patty. 

Relationship between Profit, Loss and Risk

In The Financial Expert that was Swindled by a Rogue  I drew two diagrams, Fig 1: The Wealth Creation Curve, and Fig 2: The Backward Bending Wealth Creation Curve to explain the danger inherent in forcing our funds to do the impossible. I see no better concept to use to close this piece on the need to divest into a more stable and low risk portfolio investment. Fig 1 depicts a normal wealth creation curve that has minimal risks with predictable growth. Fig 2 is the abnormal case where an investor wants to reap the highest return in the shortest possible time. This forces the wealth creation curve backwards equaling the risk of losing the investment. So, why not let time take its course on one of your portfolios?

Stripe, which builds economic infrastructure for the internet, announced on Sunday it has raised a $600 million funding round that puts its valuation at $95 billion.

The round was graced by many investors, including Allianz X, Axa, Baillie Gifford, Fidelity Management & Research Company, Sequoia Capital, and Ireland’s National Treasury Management Agency (NTMA).

The $600 million round has put the payment company above SpaceX and Instacart, whose valuation is placed at $74 billion and $39 billion respectively. Stripe has thus become the most valuable private company in Silicon Valley.

“The company will use the capital to invest in its European operations, and its Dublin headquarters in particular, support surging demand from enterprise heavyweights across Europe, and expand its Global Payments and Treasury Network,” Stripe said in a statement.

Stripe recently acquired Nigeria’s fintech startup, Paystack for $200 million, underscoring its determination to become a global brand. Although it’s still far behind other giants in the online payment industry, its $95 billion valuation makes a bold statement.

It was also named a Leader in The Forrester Wave™: Merchant Payments Providers, Q3 2020, achieving the highest scores of any company ranked.

Having fully established in the United States, the company has been taking investment to other parts of the world to secure more market share.

John Collison, President and co-founder of Stripe said Europe has become a lucrative destination for companies, and Stripe plans to cash in on the boom of its digital economy.

“We’re investing a ton more in Europe this year, particularly in Ireland. Whether in fintech, mobility, retail or SaaS, the growth opportunity for the European digital economy is immense,” he said.

Of the 42 countries in which Stripe powers businesses today, 31 are in Europe. And many of the continent’s largest and fastest growing companies are building on the platform.

Axel Springer, Jaguar Land Rover, Maersk, Metro, Mountain Warehouse and Waitrose have all recently turned to Stripe to grow and diversify their online revenue, or move faster on their transformation projects. Meanwhile, Europe’s hypergrowth companies such as Deliveroo (UK), Doctolib (France), Glofox (Ireland), Klarna (Sweden), ManoMano (France), N26 (Germany), UiPath (Romania), and Vinted (Lithuania) all build on Stripe to compete on the global stage.

Stripe now counts more than 50 category leaders—companies processing each more than $1 billion annually—as customers. Enterprise revenue is now both Stripe’s largest and its fastest growing segment, more than doubling year over year, the company said.

Stripe said it will double down on enterprise capabilities, particularly its customer success teams, to help even larger businesses like Twilio or Zapier significantly increase their revenue.

“We will also invest in our global expansion to help companies such as Glofox or MATCHESFASHION increase their market opportunity. And through partnerships with enterprise solutions like Salesforce Commerce Cloud we will make it even easier for large multinationals around the world to switch to Stripe,” said Mike Clayville, Stripe’s Chief Revenue Officer.

Stripe said it has built programmable infrastructure for global money movement, known as its Global Payments and Treasury Network, as well as a growing roster of products and services atop that foundation, including Billing, Capital, Connect, Issuing, Radar, Terminal and Treasury.

Only 14% of commerce takes place online today, despite the global economy accelerating its shift to online in 2020. Stripe’s aim is to grow the GDP of the internet, making it easy for ambitious companies everywhere to grow their business.

The company said it will continue to build its Global Payments and Treasury Network, further expanding its suite of software and services to help ambitious businesses drive more revenue in 2021. And Stripe services will also soon be available to millions more businesses in Brazil, India, Indonesia, Thailand and the UAE.

“We’re investing in the infrastructure that will power internet commerce in 2030 and beyond. The pandemic taught us many things about society, including how much can be achieved—and paid for—online, but the internet still isn’t the engine for global economic progress that it could be. While Stripe already processes hundreds of billions of dollars per year for millions of businesses worldwide, the opportunity ahead is much larger for Stripe than it was when the company was started 10 years ago,” ,” said Dhivya Suryadevara, Stripe’s Chief Financial Officer.