Telco’s tariff increase and NCC’s patriotism by Toby Prince - ITREALMS

Commentary@ITREALMS ... making leadership SENSE with digital news!

In the heart of Nigeria's digital economy, a story of patriotism and resilience unfolds. The telecommunications sector, a driving force behind the country's growth, has been facing unprecedented challenges. Despite its significant contributions to Nigeria's social and economic development, the sector has been struggling to keep up with the rising costs of operations.

For nearly a decade, telecom tariffs in Nigeria remained unchanged, while the demand for data and voice services skyrocketed. The cost of operations, however, surged due to rising energy costs, inflation, currency devaluation, and increased costs of importing telecom equipment. These mounting expenses threatened the very foundation of the sector, making it difficult for operators to maintain infrastructure and deliver high-quality services.

Financial inclusion and rise of payment - ITREALMS

Commentary@ITREALMS: 

Technology is an almost indispensable part of human history. It has however never quite progressed as projected. It almost always manages to beat expectations. The automobile, the television and even the computer all defied expectations. One of the biggest fears about technology was always about job loss. This fear never quite materialised.

Technology always manages to achieve net job gain. Rather than take jobs, technology constantly creates jobs and sometimes even whole new industries thus boosting productivity. After all is said and done, technology is now an ally, an ally to humans, an ally for human development.

On the flip side, a major challenge for development is poverty. it has been described as easily one of the most prevalent and challenging issues in the world. Beyond the definitions and categorisation, however, the stark reality is that poverty is deprivation. According to the United Nations (UN), “To be poor is to be deprived. And the worst kind of deprivation is financial exclusion.”

It is precisely the desire to curb, curtail or else eliminate financial exclusion that has financial inclusion has become a real big deal in the last decade.

And why not, traditional banks have struggled to reach large segments of the population, both in the urban and rural areas. They have struggled to reach the unbanked. They have struggled to provide services beyond the formal settings.

Banks have been unable to achieve financial inclusion. New ideas are needed. New methods are required. New technologies must come to play.

Thankfully, it is already beginning to happen. It started with payments. In the first instance card and later gradually online payments until eCommerce started to buzz. Interswitch is a pioneer in this space. Now, it has graduated to the level of firms, technology firms, offering the full range of financial services.

Today, these firms, technology firms offering financial services are aptly referred to as fintechs. They are at the root of disruption ravaging the financial services sector and are spreading fast. They are working actively to change the narrative. They seem committed to contributing to efforts to close the financial inclusion gap. They are emerging as the real MVP of financial inclusion.

Fintech, according to Investopedia, is used to describe new tech that seeks to improve and automate the delivery and use of financial services.

Fintechs are however not only technology-driven but equally deeply customer-focused, data-powered and service-oriented. They are also currently springing up like mushrooms across the country. This is not surprising as emerging markets, such as Nigeria, are the today the hotbeds for producing smart and simple financial solutions at an incredibly rapid rate. This makes sense in a country where so many are currently financially excluded.

In using modern technologies innovatively to enhance the delivery of financial products and services, fintechs find themselves not just providing alternative finance but in direct competition with banks.

This need not be the case. Yes, for a long time, fintechs offered mobile-only propositions because they lacked the legacy infrastructure and associated costs of the banks. Banks, on the other hand, lack the technology and agility of the fintechs.

But now, the future is in collaboration. No, not a competition, but cooperation and collaboration. At this point, banks and fintech must find a way to shake hands and get things done. There are huge opportunities to bridge the gap if the parties will collaborate. They must go together if the goal is true financial inclusion.

The opportunity is huge. Unconfirmed reports indicate that over 90 per cent of transactions in Nigeria are still cash-based. The opportunity to provide financial services is enormous. Every player in the sector must therefore actively collaborate to bring in a substantial portion of the 90 per cent into the formal system.

Here again, fintechs are showing the way. The driving payments as a strategy to boost financial inclusion. This is precisely why the emergence of new players like Opay is welcomed. A new fintech that entered the market with a completely new business model, one that may just be the way to go.

Opay is ensuring that a growing number of people to use its digital payments solution by offering everyday services. Think ORide, OFood, OBus and others.

Fintechs are enabling payments, increasing the number of people with access to financial services and creating jobs. Consider the massive number of agents that now dots the landscape. It is therefore not far-fetched to think that fintechs are driving financial inclusion and jump-starting efforts to free people from the clutches of poverty.

Besides, fintechs are pushing the frontier. They are rapidly expanding the borders from basic financial service such as payment to lending, savings and insurance among others. They can leverage data analytics to provide personalised loans, improve the loan disbursement timeline and promote prompt, somethings almost same day quick loans.

Firms such as Renmoney are in this space, promoting unprecedented access to quick loans. It is now so easy for anyone that desires quick loans (business or personal) to access it.

Financial inclusion, according to the World Bank, means that “individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit and insurance – delivered responsibly and sustainably.” Fintechs are making this a reality for millions of Nigerians. It is beyond commendable.

Without a doubt, the association between financial inclusion efforts and the reduction of poverty rates is a key driver for the future expansion of digital financial services (DFS).

Progress has been made. Reports indicate that about 50 per cent of adults in the country have access to financial services. It can be better. A lot more still needs to be done.

Thankfully, some banks have seen the light. They are promoting services using USSD, such that customers with the most basic mobile phones can perform essential banking services.

Here, consider Stanbic IBTC’s *909# among others. ALAT by Wema, a first in its class, is also worthy of study. With USSD and other mobile financial solutions, people can access top-notch financial services without stepping into a bank.

Also, now that the telecoms behemoths are getting into mobile money and digital financial services, a huge leap is imminent. They are expected to help advance the quest to reach the unbanked with financial services. this is plausible as there are currently over 150 million connected lines in Nigeria.

The licensing telecoms service providers is a great way to democratise access to financial services in Nigeria. There are reports that MTN plans to roll out over five hundred thousand MoMo Agent across the country, through it Y’ello Digital Financial Services (YDFS) subsidiary.

This is the future. The future is already here.

Undeniably for the benefits of technology to successfully and fully harnessed to improve financial inclusion in Nigeria the right developmental and regulatory framework must be in place.

As the world looks to end poverty, technology and fintechs are in the thick of things. Access to financial services is on the rise. The government should focus on enabling the safe and sustainable development of this critical section of the economy.

Policies that seek penalise for using e-payment must be abolished, regulations that restrain e-commerce must be scrapped and the Federal Inland Revenue Service (FIRS) must shelf the plan to tax online transactions.

Fintechs and indeed all technology solutions providers deserve a break. They are today driving financial inclusion. They are heroes of Nigeria’s financial inclusion success story. They are helping to end poverty.

*Elvis Eromosele, a Corporate Communication professional and public affairs analyst lives in Lagos.

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LEAKED: NCC writes telco to block 21 pro-Igbo, Biafra websites

ITRealms:

The Nigerian Communications Commission (NCC) has concluded plans to block a total of 21 websites and domain names suspected to have sympathy and link with the Igbo and Biafra, reports ITRealms.

Some of the domains cut across .com, .net, info and .org respectively.

NCC in a leaked letter sighted by ITRealms to one of its licensee, names withheld, which has office address located at Off Gerard Road, Ikoyi-Lagos and dated 20th October, and acknowledged on 24^th October 2017, entitled "Re: Request To Prevent the Commission of an offence under Section 146 of the Nigerian Communications Act, 2003," referenced an earlier letter dated 27 September 2017 on the subject matter.

In this letter, NCC had directed the operator to restrict access to several pro-Igbo and Biafra identified websites for alleged threat to national security.

According the letter signed by duo of Director, New Media & Information Society, Engr. Haru Alhassan and Head, Legal & Regulatory Services, Mrs Yetunde Akinloye on behalf of the Executive Vice Chairman (EVC) and Chief Executive Officer of NCC, Prof. Umar Garba Danbatta, the threats were identified by the Office of the National Security Adviser (NSA).

ITRealms further reports that NCC had directed the operator to immediately take steps to restrict access within the Nigerian cyberspace in respect of the 21 additional websites by blocking the domain names.

The restricted document, ITRealms reports affected 21 websites and domains, including:

1. http://www.igbofocus.co.uk

2. http://www.ipobgovernment.org

3. http://www.biafraland.com

4. http://www.biafraradio.com

5. http://www.biafranet.com

6. http://www.thebiafrastars.co

7. http://www.biafraforum.com

8. http://www.biafrainc.com

9. http://www.biafra.com

10. http://www.biafra.net

11. http://www.biafra.club

12. http://www.biafra.info

13. http://www.biafranigeriaworld.com

14. http://www.ekwenche.org

15. http://www.gobiafra.com

16. http://www.restoringbiafranationhood.info

17. http://www.ustream.tv/channel/biafra-television

18. http://www.biafrasay.com

19. http://www.bafmembers.com/

20. http://www.thebiafrapost.com

21. http://www.naij.com

Further, ITRealms reports that the operator was given till Wednesday, 25th October, 2017 to implement the directive and provide update to the Commission within seven days of implementation.

Chuks Egbune/GEE

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ITU gears up for 2bn people financial inclusion

ITRealms:

The International Telecommunication Union (ITU) Focus Group on Digital Financial Services hosts telco and financial services regulators from across the globe in Kuala Lumpur reports ITRealms.

Almost a year after its launch, the ITU Focus Group on Digital Financial Services (DFS) for Financial Inclusion is preparing to host its global meeting to discuss how the international telecommunications and financial services communities can work together to tackle one of the world’s most challenging social and economic issues: access to formal financial services by the world’s poorest two billion people.

The Focus Group, incorporating 60 organizations from some 30 countries, aims to bridge the gap between telecommunications and financial services regulators, and the private and public sectors. Representatives from across the DFS ecosystem will pragmatically address some of the major issues currently preventing DFS from serving the unbanked.

Chief, Media Relations and Public Information, ITU, Sanjay Acharya, said, four working-groups have been established, led by a balanced composition of regulatory authorities, operators and consumer protection organizations. 

Sanjay also said, they are developing a set of operational recommendations, tools and solutions that will fast track policy reform to support numerous developing countries in implementing the financial inclusion strategy and promoting DFS at scale. Initial findings will be discussed in Kuala Lumpur from 30 September to 2 October and at the next meeting in Geneva in December. While final reports are expected to be published late in 2016.

Chairman, Focus Group and Senior Programme Officer, Bill and Melinda Gates Foundation, Sacha Polverini, said that by leveraging the rapid growth of existing mobile networks and the use of cell phones, the majority of cash transactions could be shifted into digital form.

“Innovative digital payment systems can reduce transaction costs up to 90 per cent, giving financial institutions, mobile network operators and a new set of service providers the ability to create innovative new financial products tailored to the needs of the poor,” he said.

Regulation is a key factor. However, the payment industry has found it challenging to launch and scale services for the unbanked – an issue that affects up to 2 billion people globally, the majority of which are based in India, China and Indonesia. This is because many policy and regulatory environments are not genuinely enabling the organic development of a competitive DFS ecosystem that can reach the poor. In addition, the conversation around DFS has primarily taken place at a national level and between financial service regulators and standard setting bodies.

“Given the important role that mobile can play in addressing DFS, ITU is in a unique position to bring together both telco and financial service regulators and industry from around the world to develop a common international framework that generates better understanding and provides practical solutions” said ITU Secretary-General Houlin Zhao.

After Kuala Lumpur the Focus Group will hold its next meeting in Geneva from 15 to 17 December 2015 when in-depth discussions are expected to take place. The meeting in Geneva will be preceded by a one-day workshop on Digital Financial Services and Financial Inclusion.
 

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