TheNewsGuru

Tag: MTN

  • MTN partners LaLiga/NPFL for U – 15 football tournament

    MTN partners LaLiga/NPFL for U – 15 football tournament

    MTN Nigeria, the official communications partner of the Nigerian Football Federation (NFF), said that it would partner with the Spanish LaLiga and the Nigeria Professional Football League (NPFL) in the fourth edition of the LaLiga/NPFL U-15 football tournament.

    This is contained in a statement made available to newsmen on Friday which stated that the tournament would be competed for by the junior teams of all the premier league clubs.

    The statement also stated that the competition which started in 2017 had seen the telecommunication outfit collaborating with Valuejet to develop grassroots football in the country.

    It said that the competition would kick off on Friday at the Remo Stadium in Ikenne, Ogun.

    It quoted the Senior Manager, Sponsorship and Promotion, MTN Nigeria, Osaze Ebueku, to have commended LaLiga for partnering with MTN in developing football in the country.

    It added that Seyi Akinwunmi, the NFF First Vice-President, gave assurance that products discovered from the competition would form a pool of players for the national team.

    It quoted him as saying that one of the players who was discovered from the first edition of the U-15, Akinkunmi Amoo, was part of the Super Eagles team that played the two-leg World Cup qualifiers against Ghana.

    The statement also quoted Deji Adegbenro, who represented the Country Manager of LaLiga Nigeria, Desmond Chiji, as saying that some of the outstanding players that would be discovered from the competition would be placed in Barcelona, Real Madrid, and Atletico Madrid Football Clubs.

  • Anxiety as NCC awaits Mafab Communications to pay for 5G licence in 24 hours

    Anxiety as NCC awaits Mafab Communications to pay for 5G licence in 24 hours

    The Nigerian Communications Commission (NCC) is currently waiting for Mafab Communications to make full payments for the 5G licence won by the little known telecoms firm.

    Recall that the Federal Government had in December 2021 announced successful bidders for two 3.5GHz spectra of the 5G network licences for $547.2 million.

    MTN Nigeria and Mafab Communications won the bidding and were given up till Thursday, 24th February 2022 to pay $273,600,000 each.

    Prof. Umar Danbatta, the Executive Vice Chairman (EVC) of NCC had confirmed that MTN had paid fully for the licence while Mafab still has the grace to pay up.

    Speaking when he accompanied Prof. Isa Pantami, the Minister of Communications and Digital Economy, to Lagos for a breakfast session with start-up digital innovation techs stakeholders on Tuesday, Danbatta said:

    “Two telecommunication companies won the bid for the 5G spectrum licences in December and were given two months within which to pay up.

    “So far, MTN has paid $273,600,000 while Mafab Communication has up to the Feb. 24 to pay. There is still time and we are optimistic,”.

    According to the EVC, there is a provision in the Information Memorandum that says “we need to give our preferred bidders up to two years to operate’’.

    However, he did not comment on what would likely happen if Mafab did not meet the payment deadline. Meanwhile, he added that there was also a provision that the waiting period could be reviewed.

    “I’m not saying the review is in the process as we talk. Not yet because we want to ensure that these two assigned licences have started operations and are okay.

    “Of course, we will give them time to see what plans they have because they need to start implementing their plan for expansion of infrastructure that will support these additional services.

    “Everything is on the table, meaning we have so far auctioned two slots. We have three more to go and nothing stops the NCC from assigning the remaining slots,” Danbatta said.

    TNG reports the Federal Government last week officially handed over the spectrum allocation for 5G deployment in the country to the NCC in Abuja.

    Danbatta revealed the NCC may roll out three additional 3.5GHz spectra licences for the Fifth Generation (5G) licences in the next two years, stressing that the rollout of the three licences would depend on the pace at which winners of the first two licences developed their respective spectrum.

    He, however, said that NCC was delaying to roll out the remaining slots “until after the two years specified or the government may say, look, cut down the years from two years to maybe one year’’.

    Danbatta also noted that the government could provide additional incentives to the two licensees.

    “This is so that together, we can be able to agree that there is a need for a reduction in the waiting time for a licence,” he said.

  • MTN Nigeria denies strike notice by telecoms workers

    MTN Nigeria denies strike notice by telecoms workers

    MTN Nigeria Communications PLC has denied receiving any communication regarding an impending disruption of telecommunications services by telecoms workers over anti-labour practices.

    In a statement signed by the Company’s Secretary, Mr Uto Ukpanah, on Thursday, the company said that since it was unaware of such notice, it, therefore, would be unable to validate or comment on the issues.

    The Private Telecommunications and Communications Senior Staff Association of Nigeria (PTECSSAN) had on Feb. 8 threatened to disrupt services if their demands were not met.

    The workers had demanded that MTN Nigeria agrees on a two-week physical meeting to round off a Collective Bargaining Agreement negotiation and sign off the document.

    The workers also called for the immediate lifting of the embargo the company placed on some workers from membership of the union to allow the workers join the union, among others.

    The statement, however, said that MTN Nigeria remained committed to continued engagement with PTECSSAN and its representatives via established channels.

    “If there are any concerns, we are sure that they will be brought to our attention and dealt with in a mutually beneficial manner,‘’ it said.

    Speaking, the Chief Human Resources Officer, MTN Nigeria, Mrs Esther Akinnukawe, said that the company was dedicated to empowering employees and instilling in them a responsibility for its customers and communities.

    Akinnukawe said: “Our company cares immensely about the wellbeing of its workers, and regularly reviews people solutions and policies to ensure that they meet global best practice and make MTN Nigeria a great place to work.

    “We are committed to the development of our people and value their hard work and dedication.

    “Our workforce is our most critical competitive advantage and a key differentiator in the marketplace, so we take staff welfare, remuneration and career development seriously.

    “In line with this, we have stringent policies in place that promote meritocracy and protect our employees from all forms of harassment and discrimination and creates a workplace where employees feel valued and safe.”

  • Great expectations from 5G and the nigh impossible – By Okoh Aihe

    Great expectations from 5G and the nigh impossible – By Okoh Aihe

    By Okoh Aihe

    The meat of the antelope is very sweet, Prof Ola Rotimi wrote in one of his books, but what happens while the meat is cooking. Great line I love immensely. As I watched the Nigerian President, Muhammadu Buhari, launch the 5G Policy last week, those words played in my head while staring blankly at the television.

    I don’t want to stir the line of Charles Dickens’ Great Expectations but in moments like this, even the beautiful TV fails to provide any succour or solution to any troubling thoughts. Reality looks very remote and dreams become castles in the air.

    Speaking at the launch of the 5G Policy, the President directed the national security apparati to take advantage of the technology in solving the nation’s well documented security challenges when it comes on stream.

    In the words of the President, “5G technology is significantly faster than earlier digital technologies and it provides near real-time communication. This can play a key role in boosting our efforts towards enhancing security across the nation. It will enable our security institutions to effectively deploy robotics, autonomous vehicles, augmented and virtual reality to address any security challenges that we face. To this end, I hereby direct all the security institutions to immediately leverage 5G when deployed in order to beef up security in the country,” he said.

    Quite a number of people are talking about the advantages of 5G technology, and the President should not be an exception. After all, at the auction conducted by the Nigerian Communications Commission (NCC) in December last year, a license fetched $273m. Two licenses were put in the market and they were picked by MTN Nigeria and new entrant, Mafab Communications, respectively. A President in charge of this great country in dire need of cash wouldn’t fail to recognise the track of that windfall.

    Plus the monetary returns are some of the advantages of the technology which the President listed. “5G technologies offer a number of benefits that can support virtually every sector of our economy. For instance, it can enhance connectivity, improve healthcare, support education, foster smart cities and boost agriculture, among other advantages that it gives. It will also support security institutions with real-time communication,” he painted a convincing picture of hope.

    Surrounded by top government officials, the programme looked like a campaign ceremony; making clarifications and pontifications, and, in fact, giving rare hope, even if such hope was in the distance. It was far from a campaign. For a fact, campaigns have been over ever since, and the entire season of the President is nearly over sans a few months.

    While the meat of the antelope is cooking, what do we do? 5G is still months away but there is a major security challenge all over the country which demands urgent action. Spectrum winners are expected to make payment before the end of this month and there are no indications that the operators will roll out services immediately after payment.

    My fear is that too much expectations are being piled on 5G . Experiences down the road should warn us to tread on the path of caution. Here is the gist. Over a year ago, the government came up with the NIN-SIM Policy which would compel phone users in the country to register their SIM cards, which details must be in synced with their NINs. Although there was initial hoopla, the process was hailed as capable of helping to resolve some security issues. Records from the joint Committee handling the exercise indicate that about 73m NINs have been properly reconciled with SIMs. As I write this material, there are no indications that such security challenges have abated because of the magic of the exercise been jointly executed by the NCC and the National Identity Management Commission (NIMC). In fact, those who find it difficult to mind their own business say the situation is more complex and the body count is mounting.

    Next was the well thought out idea to shut telecom services across some states of the federation especially in the north. It was reasoned then that with telecom services shut down in these areas, the terrorists and bandits and whatever name they bear from the pit of hell, would find it difficult to communicate and coordinate their evil activities. Again there are no proofs that some good results have been achieved except that what is playing out on the streets of the affected states and in some forests, clearly demonstrate a bizarre journey to anarchy but for the gallantry of the nations’ security personnel.

    This is why I am calling for caution. 5G comes with overwhelming advantages but some of these advantages could be long in coming as it will take quite some time for services to be rolled out. These expectations should not push the regulatory agency into canvassing unnecessary rollout conditions that may put unbearable pressure on corporate organisations just set out to do normal business. I have gone through the Policy. Quite some contradictions in there but what jumps at me are some rollout suggestions in environments that may not support the business of the operators. Another caution too. The rollout is going to be expensive and no operator may be ready to put some of these equipments in areas where they will suffer equipment and revenue losses.

    It is very reassuring that the President has promised to create an enabling environment for the operators to do business. Apart from security, power supply is part of that deal. And here I tell a little which I read somewhere. When the Egbin power station went down recently, the nationalmailonline wrote wrote:

    “Nigeria generates an average of 8,000mw of electricity daily, out of the installed 13,000mw capacity, transmits an average of 5, 000mw, while distribution hovers between 3, 000mw and 2, 500mw.”

    This is circumlocution in idea presentation. The problem is not with the writer but with those who supplied the figures. The summary which they tried very hard to obfuscate is that the nation of over 200m is only able to put 3000mw of electricity in the market daily. This may not do much to support 5G. There is also an inability to tell the truth. And this is also not good for business – big or small, 5G or 2G.

    While so much miracles are expected of 5G, there is the need to temper our expectations with reality so that we do not pressure the operators out of the market with our bogus demands.

  • Strike: Union to shut down MTN operation in Nigeria

    Strike: Union to shut down MTN operation in Nigeria

    The Private Telecommunications and Communications Senior Staff Association of Nigeria (PTECSSAN) has vowed to shut down the operation of MTN in Nigeria.

    TheNewsGuru.com (TNG) reports PTECSSAN as giving MTN Nigeria telecommunications service a 14-day ultimatum to accede to its demands or face the inevitable by February 23, 2022.

    PTECSSAN President, Mr Opeyemi Tomori, and General Secretary, Mr Okonu Abdullahi gave a 14-day ultimatum in a statement on Tuesday in Lagos.

    They accused MTN Nigeria of remaining adamant in listening to the cry and demands of their workers who are members of the union in spite of interventions by the Minister of Labour and Productivity.

    “It has become inevitable that our union issues this 14-day ultimatum to alert the public of an imminent industrial action.

    “Also, the disruption of telecoms service may affect MTN network subscribers, and the adverse effect on their businesses, business partners and associates.

    “As daunting as those issues raised back then were, it was the firm belief of our union that the collective bargaining agreement, if negotiated in good faith and signed off by both parties, would go a long way in addressing the concerns of the workers in the organisation.

    “Unfortunately, the company has remained adamant, insisting that all the workers’ conditions of service as stated in the company’s policy must remain so and cannot be negotiated.

    “This negates the agreement they hitherto signed at the Ministry of Labour to fully negotiate the workers’ condition of service,” both union leaders said.

    The leaders said that the issues bordering on the union include non-existence of mutually negotiated exit benefits; discriminatory remuneration or benefits; inhumane retirement benefit.

    The union, therefore, called on the company’s management to agree on a two-week physical meeting to round off the CBA negotiation and sign off the document.

    “Also, the management should immediately lift the embargo it placed on some workers from membership of the union by communicating to them that they are free to join the union since membership is in the first instance, voluntary.

    “If any of our demands are not met on or before Feb. 23, 2022 we shall be mobilising in conjunction with other sister unions affiliated to Nigeria Labour Congress workers within and outside the company for industrial actions that will force management to grant our demands,” the leaders said.

    When contacted, MTN Nigeria’ Communications Office, in a text message, said the company’s management would respond in due time.

    “We will issue a release on it soon. Thank you,” he said.

  • How Mafab, MTN dislodged Airtel in race for 5G deployment in Nigeria

    How Mafab, MTN dislodged Airtel in race for 5G deployment in Nigeria

    After 11 rounds of bidding that lasted eight hours, Mafab Communications Ltd and MTN Nigeria Plc dislodged Airtel Networks Ltd to emerge the two successful winners of the 3.5 gigahertz (GHz) spectrum auction for the deployment of Fifth Generation (5G) technology to support the delivery of ubiquitous broadband services in Nigeria.

    TheNewsGuru.com (TNG) reports both Mafab and MTN emerged winners in a keenly contested 3.5GHz Spectrum auction conducted by the Nigerian Communications Commission (NCC), in collaboration with the Federal Ministry of Communications and Digital Economy.

    Three companies, namely MTN, Airtel and Mafab Communications Limited, had qualified for the auction, having met the requirements stipulated in the Information Memorandum (IM) for the spectrum auction. The three companies had also participated in a mock auction held on Friday, December 10, 2021, which served as a precursor to the Main Auction conducted on Monday at the Transcorp Hilton Hotel, Abuja.

    In an exercise that clearly demonstrated demand outstripping supply, with Ascending Clock Auction System adopted by the NCC, the three bidders participated in the intensely competitive auction bid.

    In the first round of the auction, the bid price was fixed at $199,374,000.00; $201,367,740.00 at second round; $204,388,356.10 at third round; $209,407,962.50 at fourth round and $215,782,901.30 at the fifth round.

    The auction prices increased progressively to $224,414,217.43 at the sixth round; $231,146,643.96 at the seventh round; $240,392,509.71 at the eighth Round; $251,210,172.65 at the ninth round; and $263,700,050.00 at the round 10 of the auction exercise.

    The auction process reached its peak at round 11 when the bid price graduated to $275,904,886.25 with all the three bidders still actively participating.

    The Main Stage of the Auction, however, ended at the conclusion of the 11th round, with Airtel listing an exit bid of $270,000,000, while MTN posted an exit bid of $273,000,000, giving way to the assignment stage.

    At the assignment stage, Airtel had dropped off from the race having posted a lower exit bid, thus leaving Mafab and MTN as winners of the two available lots.

    Announcing the results of the auction exercise, the Executive Vice Chairman of NCC and Auction Overseer, Prof. Umar Garba Danbatta, who recalled the processes and activities leading to the successful conduct of the auction, said the NCC published a public notice on its decision to award two lots of 100 megahertz (MHz) Time Division Duplex (TDD) available in the 3.5 GHz band through an auction process to support the delivery of ubiquitous broadband services for the deployment of 5G network in Nigeria.

    “Subsequently, an Information Memorandum was issued on November 10, 2021, in which Bid applications for the available spectrum lots were invited. By the deadline for receipt of applications on November 29, 2021, the Commission received applications from three licensed telecoms companies, viz: Airtel Networks Limited, Mafab Communications Limited and MTN Communications Nigeria Limited.

    “The auction held successfully today, Monday December 13, 2021 at the Transcorp Hilton Hotel, Abuja with the three bidders competing for the available two slots. The Commission adopted the Ascending Clock Auction format which ended after Round 11 and proceeded to the Assignment Stage. It is my pleasure to announce that at the end of the auction, Mafab Communications Limited and MTN Communications Nigeria Limited emerged as provisional licence winners,” he said.

    Arising from the above, Danbatta said that the winning bid price for the auction is $273,600,000 for each lot of 100 MHz TDD and the provisional winners are expected to pay the Winning Bid price, less the Intention-to-Bid Deposit, by February 24, 2022.

    He expressed satisfaction that the auction process was efficient, fair, credible, well-organised and transparent and was designed to deliver the ideal outcome.

    Accordingly, Danbatta said the strongest bidders have emerged provisional winners, raising a substantial amount for the Federal Government.

    The EVC congratulated the winners and thanked the Federal Government for its support and commitment to the deployment of 5G technology in Nigeria, which, he said, will bring substantial network improvements, including higher connection speed, mobility and capacity as well as low-latency capabilities to communications services in Nigeria.

    Sequel to the successful auction by the two winners, Danbatta said in line with the processes outlined in the IM, the provisional winners have proceeded to the Assignment Stage.

    “MTN Communications Nigeria Plc made an offer of $15,900,000 for the assignment of a preferred Lot, while Mafab Communications Limited made an offer of $11,120,000 for a preferred Lot. Thence, MTN Communications Nigeria Plc, having made the highest offer was given the right to select its most preferred Lot and it selected Lot 1 (3500-3600 MHz), while Lot 2 (3700-3800 MHz) is consequentially assigned to Mafab Communications Limited at no extra cost,” the EVC said.

    The EVC thanked all stakeholders, who have contributed to the success of the auction process. He said the huge investment that will accrue from the sales of the spectrum band auctioned will result in increased transformation in life and businesses.

    Earlier, at the opening ceremony, the Honourable Minister of Communications and Digital Economy, who doubles as the Chief Host, Prof. Isa Ali Ibrahim (Pantami), who emphasized Federal Government’s commitment to driving digital economy, commended the Commission for its efforts towards implementing the 5G Deployment Plan for the country.

    He expressed optimism that the dawn of 5G network in Nigeria will offer significant advantages over current technologies, some of which include much lower latency, higher bandwidth, greater device density, longer battery life for nodes, and greater network flexibility.

    Also in his remarks, the Chairman, Board of Commissioners, NCC, Prof. Adeolu Akande, said that spectrum plays a strategic role in meeting the insatiable demand for advanced mobile data services as well as a new wave of wireless broadband such as remote object manipulation, industrial automation, virtual and augmented reality, and next-generation connectivity for vehicles. He said the use cases will continue to increase the impact that mobile services have on societies and economies.

    He commended the Minister for his unflinching support, the Board of Commissioners, Management and staff of the NCC for the role they played in making the auction to be successful. He also thanked the bidders for believing in the Nigerian communications sector by their willingness to invest millions of dollars in the sector for the provision of 5G services. He said that the Commission is committed to transparency and openness, which the auction represents.

    Prof. Akande’s voice was amplified by the Executive Commissioner Technical Services at NCC, Engr. Ubale Maska, who served as the auction adviser. While delivering the Vote of Thanks, Maska conveyed the gratitude of the Commission to all stakeholders, giving special mention of the Auction Planning Committee, the media and staff of the Commission.

  • BREAKING: NCC makes history with auction of 3.5Ghz spectrum for 5G roll out in Nigeria

    BREAKING: NCC makes history with auction of 3.5Ghz spectrum for 5G roll out in Nigeria

    History was made today in the heart of the Federal Capital Territory (FCT), Abuja as the Nigerian Communications Commission (NCC) successfully auctioned the 3.5GHz spectrum band for the roll out of 5G network technology across the country.

    TheNewsGuru.com (TNG) reports with the successful auction of the 3.5GHz spectrum band by the NCC, Nigeria has joined the United States, South Korea, China, South Africa and an exclusive league of other countries providing 5G services across the globe.

    As Nigeria eyes to roll out 5G networks across the country from 2022, two telecom companies; namely, MTN Nigeria and Mafab Communications Ltd won the auction of the 3.5GHz spectrum band.

    TNG reports Airtel Networks Ltd was the third telecom firm that joined MTN and Mafab in submission of the bid and made payment of the ten percent fee of $20 million for the two lots in the 3.5GHz spectrum band released by the NCC.

    Reserve price per lot was pegged at $197,400,000 at the start of the auction. At the end of round one of the bid exercise, the price per lot climbed to $199,374,000. At the end of round 2, the price climbed to $201,367,740 and round 3 to $204,388,256.

    At round 4 the price per lot stood at $209,497,962, round 5 at $215,782,901, round 6 at $224,414,217, round 7 at $231,146,643, round 8 at $240,392,509, round 9 at $251,210,172, round 10 ar $263,017,050 and round 11 at $275,904,886.

    TNG reports all three bidders remained in the auction process till round 11 until Airtel fell off the bid process. The 3.5GHz spectrum band auction by the NCC was won at $273,600,000, with provisional licensees expected to make payment of the amount by 24th of February 2022.

    Meanwhile MTN made the highest bid of $15,900,000 at the assignment stage of the auction exercise to be assigned the preferred lot of lot one, while Mafab was assigned lot 2 at no extra cost.

    However, there is hope for the loser to try again, as the “Commission will maintain the Auction Price of the 3.5GHz auction as a minimum to be applied when the remaining slots are available and cleared of encumbrances”.

    TNG reports the process of clearing these encumbrances is estimated to take a minimum of twenty four months, according to the NCC.

    Speaking at the auction, Executive Vice Chairman and Chief Executive Officer (CEO) of the NCC, Prof Umar Danbatta said the auction was a culmination off efforts at the international and national levels that have prepared Nigeria for the momentous leap forward.

    “Today’s auction is momentous in many regards and will usher Nigeria into the exclusive league of countries providing 5G service across the globe. I am particularly pleased to be associated with this auction process because when His Excellency President Muhammadu Buhari, GCFR, brought us on board in the year 2015, we took a decision to reposition the Commission on a path that will ensure the uptake of all the opportunities that abound in the communications sector,” Danbatta said.

    According to statista, 58 countries had 5G networks as of June 2021, up from 38 about a year ago. A dozen more have had 5G mobile technology deployed in part. It is in fact expected that 5G will reach 1 billion users in 3.5 years, compared with 4 years for 4G and 12 years for 3G.

    TNG reports 5G is the fifth generation of mobile phone communications standards. It is a successor to 4G and promises to be faster than previous generations while opening up new use cases for mobile data.

    Unlike past historical transitions in wireless architecture, 5G represents an ongoing evolution of existing networks rather than the wholesale replacement or “forklift” approach to deployment.

    The 5G benefits range from faster speeds (up to 10x faster), much lower latency (up to 50x lower) and greater capacity allowing many more devices to be connected at the same time.

    Up to 100 times faster than 4G, 5G, the fifth generation of cellular networks, is creating never-before-seen opportunities for people and businesses.

    With faster connectivity speeds, ultra-low latency and greater bandwidth, 5G has the capacity to transform industries and dramatically enhance day-to-day experiences.

    It has been assessed that 5G technology could be responsible for 22.3 million jobs and $13.2 trillion of global economic output by 2035.

  • With MTN and Airtel joining the PSB fray, let the games begin, By Okoh Aihe

    With MTN and Airtel joining the PSB fray, let the games begin, By Okoh Aihe

    By Okoh Aihe

     

    A seemingly innocuous announcement made last week is scratching up something very huge; so huge that we don’t really know how huge it is at the moment. The announcement was to the effect that MTN Nigeria and Airtel Nigeria have been awarded PSB licenses by the Central Bank.

     

    PSB is Payment Service Bank. The license is issued by the Central Bank of Nigeria (CBN) to telcos to enable them leverage on their massive infrastructure rollout and dealer network to offer some banking services especially to the underbanked, The simple meaning being that anywhere you are in Nigeria with a phone number and a handset, including I-better-pass-my-neighbour handset, you will be able to do some banking transactions.

     

    It is kudos to the Central Bank and a brave retreat from previous error of judgement when initial licensing was done.

     

    I was almost emotional and I will explain why. At AfricaCom in November, 2018, in Cape Town, South Africa, former Group Managing Director of MTN, Rob Shutter, had made a bold pitch for the Nigerian money sector, announcing to the audience that the country was in the process of licensing telcos to play in the sector, and that MTN was preparing in a big way to leverage on their experience in other countries of the continent to play a very pronounced role. That for me was a great moment, that a major operator in the continent should speak so highly of the Nigerian market, and, in fact, market the country more than some people who are paid heavily to do same job but ill-equipped to handle it.

     

    But things would always go the Nigerian way, when wonders or abracadabra supersede reason. When results were announced, both MTN and Airtel did not meet the cut. The reasons adduced were trashy as they were puerile, quite economically wayward and illogical enough to ambush the good intentions the CBN had nursed in planning the entire process. It was the downside of a good idea and the results have been shoutingly disappointing.

     

    The announcement last week by the CBN was to right such wrong and to demonstrate that the real strength of a great man or institution lies in admitting a wrong and getting the balls to do the right thing.

     

    Let’s look at a little story. The National Financial Inclusion Strategy (NFIS) which sought to ensure that over 80 per cent of the bankable adults in the country had access to financial services by 2020, was launched on October 23, 2012, by the Central Bank in collaboration with other stakeholders. The primary target was to reduce the exclusion rate to 20 per cent by the year 2020.

     

    However, in an October 5, 2018, Exposure Draft on the Guidelines for Licensing and Regulation of Payment Service Banks, addressed to industry stakeholders, the Central Bank confessed that in spite of taking sundry measures, including the introduction of Micro Finance Banking, Agent Banking, Tiered Know-Your-Customer Requirements and Mobile Money Operation (MMO) in pursuit of the objective, the Central Bank confessed the results have not been good.

     

    In doing that reality check the Central Bank, along with other stakeholders which include: Nigerian Communications Commission, Commercial Banks, Mobile Money Operators, and Telecommunications companies conducted some research to determine the way forward, and voted for PSBs as an attractive critical element of growth since the telcos have a wider reach and more robust network than all the banks combined.

     

    “The key objective of setting up Payment Service Banks,” according to the CBN documents, “is to enhance financial inclusion in rural areas by increasing access to deposit products and payment/remittance services to small businesses, low-income households and other entities through high-volume low value transactions in a secured technology-driven environment.”

     

    The PSBs can target the underbanked and remote communities to provide very simple banking services which include but not limited to, savings, deposits, transfers, remittances, investment in bonds and other services to make life easy financially in any location in Nigeria where there is a telecommunications network. They can also issue debit cards.

     

    It would seem the Central Bank is trying to reduce the pressure on the traditional banks who are sometimes, pressured to expand services beyond their reach and capacity irrespective of returns in that environment.

     

    But in that effort of the Central Bank is a contradiction and competition that my alter the field of play forever. There are over 200m phone lines in the country. Each line can almost be an account that can be used by the owner. The only disadvantage for some big fellas is that they can no longer lie about not being able to go to bank and do transfers. Just a little work on the phone, and the deed is done. The Central Bank is looking for an integration of the rural communities and the unbanked in the inclusive banking system, and this may just be it.

     

    In September 2019, three PSB licenses were issued as follows: Globacom’s Money Master, 9Mobile’s 9PSB and Hope PSB, a subsidiary of Unified Payment. From all indications, they have seemed to under performed.

     

    Some industry experts have told this writer that the coming of MTN and Airtel is expected to animate the industry with new life and excitement for some obvious reasons. The combined infrastructure resource of the two operators is huge and spans the length and breadth of the country. Being two of the biggest operators in the country, their dealer network also gives them an overwhelming advantage. The strongest factor yet is that both MTN and Airtel have provided same services in other market jurisdictions and would now have to tap into accumulated experience to do something quite racy, nuanced and rewarding to service providers and subscribers.

     

    There may be some regrets that the first licensees did not take full advantage of first mover experience but the reality is that real competition is about to start in the PSB ecosystem. My little call is for Nigerians to position themselves for market benefits and opportunities that will be unleashed.

     

  • [JUST IN] PSBs: CBN grants ‘approvals in principle’ to two telecoms companies

    [JUST IN] PSBs: CBN grants ‘approvals in principle’ to two telecoms companies

    The Central Bank of Nigeria (CBN) on Tuesday granted approvals in principle towards the licensing of payment service banks (PSBs) to two leading telecommunication services providers in Nigeria, MTN and Airtel.

    The apex bank granted the green light to MTN for MoMo Payment Service Bank Limited while Airtel got the approval for its subsidiary SMARTCASH Payment Service Bank.

    In a separate statements obtained by TheNewsGuru.com, TNG, MTN Nigeria on its own disclosed that the provisional service bank licence is the first step in a long process that would lead to eventual approval.

    This simply means that MTN Nigeria would be required to fulfil a number of conditions, even as “the decision to issue a final approval is firmly within the regulatory purview of the CBN.”

    MTN Nigeria expressed optimism that it would eventually get the PSB license and reaffirmed its commitment to the financial inclusion agenda of the CBN in Nigeria.

    The company’s secretary, Uto Ukpanah, noted that “while we look forward to the eventful grant of a final PSB license, we will continue to communicate material information in accordance with regulatory obligations and guidelines.”

    On Airtel’s part, its CEO, Mr Segun Ogunsanya said, “ I am very pleased that Smartcash has been granted an approval in principle to operate a service bank business in Nigeria. We will now work closely with the Central Bank to meet all its conditions to receive an operating licence and commence operations.

    “The final operating licence will enable us to expand our digital financial products and reach millions of Nigerians that do not have access to traditional financial services.

    “I am looking forward to working closely with the government, Central Bank, and traditional financial institutions to expand financial inclusion and meet the evolving needs of our customers and the economy.”

    MTN and other non-financial companies have long been awaiting their PSB licenses since the Nigerian government first announced its willingness to issue them in 2018.

    The announcements have been taken by industry stakeholders as a welcome development, a first step in what was deemed a financial revolution.

  • Airtel, MTN get approval to offer banking service in Nigeria

    Airtel, MTN get approval to offer banking service in Nigeria

    The Central Bank of Nigeria (CBN) has approved in principle for Airtel Nigeria and MTN to operate a service bank business in the country.

    TheNewsGuru.com (TNG) reports this is contained in separate statements released by the telecom giants on Friday.

    According to the statements, this is the first step in the process towards a final approval. Final approval is subject to the telecom giants satisfying certain standard conditions within the next six months.

    TNG reports Airtel got approval for its Smartcash payment service and MTN got approval for its MoMo payment service.

    The payment services allow cash transfers for people who do not have bank accounts and ATM cards.