By AYOOLA OLAOLUWA
Deposit Money Banks (DMBs) is reaping huge profits in Unstructured Supplementary Service Data (USSD) fees by charging customers far above the stipulated rate allowed by the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC), Business Hallmark investigation has revealed.
It would be recalled that the CBN and the NCC had on March 16, fixed per charge transaction using USSD services at N6.98 with effect from March 16, 2021.
The decision was reached after a meeting between concerned stakeholders to find a solution to the protracted dispute between Mobile Network Operators (MNOs) and deposit money banks over the appropriate USSD pricing model for financial transactions.
A long drawn out battle between banks and telcos over who should pay for USSD had started in 2018, with telcos insisting that banks should pay for the charges which they put at N12 for one session and then remit it in bulk to them (telcos).
The banks refused the plan, telling telcos to charge customers directly. Borthered by the negative effects of the feud on financial operations, the NCC waded in by setting a price cap of N4.98 for each session.
The NCC intervention, however failed to resolve the dispute as the telcos sent out its notifications to their customers, saying they would be charging customers a flat rate of N4 for every USSD transaction that passed through their networks.
The NCC and CBN again intervened, pegging the rate at N4.98 and ordering banks to pay telcos the charged fees. The refusal of the banks to agree to the terms sparked a two year fight between them. The fight recently reached a turning point when the Association of Licensed Telecommunications of Nigeria (ALTON) threatened to shut down USSD platforms in Nigeria from Monday, March 22, 2021. However, the dispute was laid to rest on March 16.
This (rate) 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, the NCC and the CBN had stated in a joint statement immediately after the March 16 meeting with stakeholders.
With the truce, bank customers making transfers through the USSD are expected to pay a flat rate of N6.98 fee per transaction, which is relatively cheaper than what telcos had planned to charge in 2019.
The announcement came as a relief to millions of Nigerians who praised the intervention and predicted that it will ensure a much cheaper average cost to enhance financial inclusion.
However, BH investigation revealed that banks are creaming off Nigerians by charging far above the rate sanctioned by the CBN and NCC.
For instance, a transfer of between N1,000 – N4999 from Access Bank to First Bank attracts a fee of N10.75.
In the same vein, the transfer of N5000 to N9,999 attracts a fee of N20, while the transfer of N20,000 to N30,000 attracts N26.88 fee.
On further investigation, it was observed that the more money transferred by a customer, the higher the fees paid.
The same fees regime employed by Access Bank is also adopted by other DMBs operating in the country. For instance, while Zenith Bank charges N10.75 on a transfer of N1,000, a transfer of N40,000 attracts N26.88, exactly N16.13 difference.
Not surprisingly, some bank customers who spoke with our correspondent on the development, lamented that they have been at the mercy of the banks for quite a while, with the CBN and other regulatory authorities abandoning them to their fate.
“I was not really enthusiastic about the announcement. I have been in Nigeria for quite a while to know that nothing changes.
“So when I made my first transfer of N20,000 on March 18, just two days after the announcement of a flat rate of N6.98 was made and I was charged N28.88, I said “Didnt I said it”, declared a Union Bank customer, Tajudeen Rasaq.
Another customer who bank with Access Bank, Blessing Ngwama, complained bitterly over the huge bill she incurred in just one day when she transferred the sum of N200,000 in multiple tranches.
“To get to my bank and back home, I usually spend N200. But when I heard that the fee on transfers has been reduced to N6.98, I was so happy.
“So, when I received the sum of N200,000 from a tenant who we rented out our late father’s property to, I decided to spare myself the trouble of going to the bank and also save some money I would have used as transportation by sharing the rent among my 13 siblings through transfer, thinking that the charges will amount to about N91.
“But after the twelfth attempts at transferring N15,400, I received an ‘Insufficient Fund’ message, despite the fact that I still have some money left in my account apart from the N200,000 rent.
“I initially thought it was a network issue and kept trying untill something prompted me to check my account balance. I was shocked when I got a message that I only have N15,200 left.
“This was an account that had over N201,000 before I began the transfer. I decided to visit the Access Bank branch at Fagba the following day.
“But by the evening of the same day, I started getting another sets of ‘Debit Alert’ messages on my phone totalling 15. While 12 were meant for transfers fees I made in the afternoon, N26.88 for each, totalling N322.56, one was for FGN Electronic Transfer Levy, known by many Nigerians as Stamp Duty of N50 on the N200,000 rent deposit, N53.73 for Card Maintenance Fee-VISA/VAT and N4 on every SMS alert.
“All these charges and others which were not stated cost me over N1,000. I had to ask my husband to transfer some money into my account to help conclude the family business”, Ngwama lamented.