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Banks allegedly block MTN from banking channels, leave customers stranded

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A feud between Nigerian banks and MTN reportedly left millions of subscribers unable to recharge their phones using the USSD services on Friday.

According to Premium Times, this was because banks shut off the telecom firm over fees charged for the service.

MTN, without telling customers what the problem was, sent messages, advising them to seek alternative means of recharging their phones.

One of such messages read, “Dear Customer, our bank recharge channels are currently unavailable. Kindly recharge using physical cards. We apologise for the inconvenience. Thank you.”

“Please be informed that some of MyCustomers may not be able to purchase airtime and data recharges via banks including MOD and myMTN App,” another read.

“Please pacify MyCustomers and educate them to use MTNTopit, MoMo channels, as well as the debit card options on MOD or myMTN App.”

Nigerians, on Friday, had taken to social media to express their frustrations. A top industry official who craved anonymity claimed that banks cut off the service to protect their profits. He described the move as “tyrannical”.

“Banks have tried to remove the cost of using USSD, but are willing to cut off subscribers to protect their own fees earned through the channel,” the source told Premium Times.

“This only has to do with the preservation of bank profits, which are already substantial and growing despite the wider economic conditions.

“The government needs to step in and deal with this once and for all. Nigerian banks need to stop their tyrannical posture. USSD has not been cut by MTN as far as I know.

“Note that with their action, the banks are denying customers from accessing their money to make legitimate purchases/transactions.

“Banks are focused on bullying everyone to maximize their revenues. The banks did not send a formal communication to customers or to MTN before taking this action,” the source added.

Why MTN first?

The Street Journal earlier reported that there was a row between telecoms subscribers and banks over USSD charges.

The Association of Licensed Telecommunication Operators of Nigeria (ALTON) said banks owed its members N42 billion and threatened to suspend service.

However, the Central Bank of Nigeria and the Nigerian Communications Commission on March 15 settled the row between banks and telcos over fees by imposing a new charge for the banks’ short-code service.

From March 16, subscribers paid N6.98 each time they use the USSD for banking transactions. That arrangement has angered customers and alarmed advocates of financial inclusion.

A source further told Premium Times that the telcos sought to reduce the banks’ share by almost half, which banks kicked against.

The banks argue that since they maintain the infrastructure through which the recharges are done, they deserve better.

In protest, the banks decided to remove MTN services from their infrastructure.

“The 42 billion they are owing us (MTN and others), they don’t want to pay.

“Rather, they want to surreptitiously factor it into a new price regime so that customers will unknowingly help them pay what they had already billed them. Of course, we refused, which is why they are fighting us now.

“Meanwhile the overnight suspension of airtime sales by some of the banks is not restricted to USSD channels alone, but includes airtime purchases through all banking channels – bank apps, bank USSD codes, even debit cards,” another source told the publication.

As of the time of filing this report, neither MTN nor banks have responded to the development.

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