Olusola Teniola on why Nigeria's telcos must be transparent in USSD pricing, end-user billing

The telecommunications industry in Nigeria is facing a showdown with the banking sector over the pricing and transparency of Unstructured Supplementary Service Data (USSD) transactions. The recent dispute has ignited a debate on the cost-sharing model and the need for regulatory intervention to ensure fair practices among all stakeholders. Olusola Teniola, President of the Association of Telecoms Companies of Nigeria (ATCON), shed light on the complexities of the issue in a recent interview with CNBC Africa. The key theme that emerged from the discussion was the call for transparency and accountability in USSD pricing to protect both telecom operators and end-users. Here are the key points from the interview that highlight the ongoing conflict between telecom operators and banks over USSD pricing: 1. Revenue Sharing Formula Dispute: The crux of the issue lies in a revenue-sharing formula that was in place for channels provided by telecom operators to the financial sector. However, this model was discontinued for USSD transactions as banks deemed it a sunk cost and ceased remitting payments to telecom companies. The Nigerian Communications Commission (NCC) intervened by commissioning a cost determination study, which revealed that some charges levied by telecom operators on banks were below cost. This disparity led to a breakdown in the revenue-sharing model, causing tensions between telecom operators and banks. 2. Lack of Transparency in End-User Billing: The lack of transparency in end-user billing became a focal point of the dispute, with concerns raised about the arbitrary charges imposed on consumers by banks. While telecom operators were transparent about their pricing following the NCC's cost determination study, banks were accused of withholding payments and continuing to charge consumers for USSD transactions. The intervention of the Honorable Minister of Communications led to a temporary halt on end-user billing, prompting calls for greater transparency from both telcos and banks. 3. Cost-Sharing and Accountability: ATCON President, Olusola Teniola, emphasized the need for cost-sharing between telecom operators and banks to cover the expenses of maintaining the USSD platform. He underscored the commercial nature of the dispute, stating that telecom operators should be reimbursed for the costs incurred in providing USSD services. Additionally, Teniola called for accountability from banks in honoring their financial commitments and elucidating the reasons behind their reluctance to pay for services rendered by telcos. The ongoing saga between telecom operators and banks highlights the complexities of the digital economy in Nigeria, where regulatory oversight and industry collaboration are essential to safeguarding consumer interests and fostering a transparent business environment. As the dispute unfolds, stakeholders await further developments and regulatory guidance to navigate the intricacies of USSD pricing and end-user billing in the country.