A few weeks ago, I wrote that the telcos, despite interventions from the telecom regulator, NCC, would have to recalibrate on what the banks want, on USSD revenue, and commission on airtime across channels (app, web, ATM, etc). Yes, I used the word “lose” for the telcos. My point is simple: the most united and fraternal institution in Nigeria is the Bankers Committee. In short, if you elevate them to the Federal Executive Council and they decide to fix Nigeria, we have a chance. When the Bankers commits, it is done.
We got these two updates from insiders
#1 – Happy Good Friday. Regarding the post below, the feud between MTN and the Banks is as a result of MTN writing all the Banks of reduction in airtime commission from 5% to 2.5% to take effect from April 1. All the Banks unilaterally rejected the reduced commission and responded to MTN to reverse the decision or their subscribers won’t be serviced from the Banks channel. The deadline to given to MTN by the Banks elapsed yesterday – April 1#2 – The Bankers Committee actually shutdown the MTN E-top up channel because MTN according to the Committee has reduced their upfront discount from 4% to 2.5%, hence the Bankers feel edged out having been enjoying good profit from that channel. Other MNOs didn’t tamper with their incentive on that channel, hence it is more of Electronic top up discount than USSD issue. Just giving you a heads up Boss.
Largely, the bankers have the capacity to set the prices and hold firm. But telcos are not strong enough to come together. And that playbook is playing: “A feud between Nigerian banks and MTN left millions of subscribers unable to recharge their phones using the USSD services on Friday, after banks shut off the telecoms firm over fees charged for the service.” What is happening there? The banks want what they want and if MTN cannot deliver, it is out of the channels.
Yes, indeed. Before you can recharge your phone or buy data for browsing, you need to have money – and the banks keep that money. Technically, everything begins with the banks and if you do not align with them, you are off. The rumour is that MTN reduced commission and banks resisted.
And did you notice something else? Airtel, Glo and 9Mobile are not in the hooks. Banks would not have been in that dislocated position – unity of one is supreme in the sector! That is why banks decided to band together for BVN (bank verification number) instead of the disjoined SIM card registrations we did in the telecom sector. A more optimal model would have been – register a SIM card in Glo, and when in MTN, they can use that data and add you MTN Sim card instead of re-doing the whole data capture all over again.
Airtime loaded from app, USSD, etc is a big business in Nigeria and banks will not give up. Expect NCC and the Central Bank of Nigeria (CBN) to meet. But nothing will happen until MTN agrees to whatever the banks want.
A feud between Nigerian banks and MTN left millions of subscribers unable to recharge their phones using the USSD services on Friday, after banks shut off the telecoms firm over fees charged for the service.
MTN advised its subscribers to seek alternative means of recharging their phones without informing them what the problem was.
“Dear Customer, our bank recharge channels are currently unavailable. Kindly recharge using physical cards. We apologise for the inconvenience. Thank you,” one message read.
Another read: “Please be informed that some of MyCustomers may not be able to purchase airtime and data recharges via banks including MOD and myMTN App. Please pacify MyCustomers and educate them to use MTNTopit, MoMo channels, as well as the debit card options on MOD or myMTN App.”
Phone users expressed their frustrations online as the outage lasted throughout Friday.
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