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Nigeria blocks MTN's proposed USSD access charge

Nigeria blocks MTN's proposed USSD access charge

Nigeria's communications minister Isa Pantami has blocked a planned move by MTN to charge users N4 (US$0.013) per every four seconds for Unstructured Supplementary Service Data (USSD) access to banking services.

Pantami gave the Nigerian Communications Commission (NCC) the nod to suspend the proposed charge, scheduled to be enforced from 21 October, after notification by the operator to subscribers sparked a social media furore.

MTN's message reads: "As requested by your bank, from Oct 21, we will start charging you directly for USSD access to banking services. Please contact your bank for more info."

The USSD is a real time messaging communication technology that serves for account opening, balance and other enquiries, money transfer, airtime vending, bill payment, etc. with a shorter turnaround time than SMS.

When users interact with a remote application from their device, the USSD starts a predefined session to facilitate the transfer of information between the application and the user.

Since Pantami put a hold on the proposed charge until he is "fully and properly briefed", according to a statement from his office on Sunday, the directive (which will also affect other telcos) can still be reversed.

Nigerians who flooded the communication ministry's Twitter pages claimed that other telcos have been deducting similar charges from their bank accounts for months.

It's worth noting that it was the Central Bank of Nigeria (CBN) that issued a regulatory framework for the use of the USSD as a protocol for GSM networks to communicate with the platforms of service providers like banks in April 2018.

In the framework, the apex bank recommended that financial institutions and MNOs/VAS establish a service level agreement based on service and availability.

Also, in a 'Determination of USSD pricing' document issued by the NCC in July 2019, it was the NCC that, among other things, determined a USSD session to be 20 seconds; that the cost of a USSD session is N1.63, that the price floor for a 20 seconds USSD service is N1.63 while the price cap for a 20 seconds USSD session is N4.89.

The regulator determined that telcos "are to price at cost plus margin" and the pricing should "take effect from this 1st Day of September, 2019 and remains valid and binding on licensees".

The development comes as Pantami calls for a reduction in the cost of data with Nigeria ranked outside of the top ten African countries with low average price of data according to UK-based price comparison website, Cable.

Nigeria's teledensity too has been reviewed to be below 100% for the first time since January 2015.

According to its most recent statistics, the NCC started calculating teledensity based on a population estimate of 190 million instead of 140 million, which explains why its teledensity level has dropped to 92.67 as at August 2019.

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