Banks and USSD charges

BY TADE JOKOTOLA

Do you know the minimum amount some banks charge customers for USSD transactions is N10 for checking account balances, inter-bank transfer costs N50 per session? Of course, the banks also charge for POS transactions. In all of these, the banks pocket these monies, which come at near zero cost to them.

Do you know that banks will have been forced to build branches, invest in employing tellers and several other service staff if the option of USSD is not in existence? Meanwhile, they utilise the network resources of the mobile telecommunications operators but bluntly refuse to share the revenues with them. Rather, they ask the telcos, in one breath, to go ahead and charge the customer and, in another breath, lament the negative consequences of that on financial inclusion. What financial inclusion are we talking about, when you consistently deplete the account balance of your customers with all manner of charges, including what is called Monthly Account Maintenance Fee!

The NCC hired a consultant who determined the cost of delivering USSD services to be about N4.98. The ideal thing is for the banks to bear this cost and even pay an extra charge, but no, they are rather mouthing “financial inclusion”, which they practise only in the breach. The banks successfully confuse or manipulate the CBN to deny some telcos easy access to rendering Financial services through Payment Service Banking business.

Indeed it’s true, as they claim, that USSD is a critical national resource in jurisdictions like India, but that is only half the story. What they didn’t say, which many discerning Nigerians are aware of, is that USSD is a regulated service in India and also the telcos play actively in the banking sector. So, the telcos can zero-rate the cost of USSD to their customers as well as the banks’ customers.

The banks should stop playing games and allow the process of opening up the financial services space to all players. The FG should also intervene by engaging knowledgeable people to professionally and dispassionately look into the issues between the banks and the telcos. A situation where the powerful banks are running the CBN through their former colleague, who is the CBN Governor, will not augur well for economic growth, with particular reference to Financial Inclusion, a pivotal aspect of the FG economic policy!

It’s important Nigerians know who their REAL enemies are. The telcos are investing huge resources in network infrastructure but the banks want to continue to fleece their customers and, in addition, reap
where they did not sow. That is unjust and unfair!

Jokotola lives in Lagos.