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Nigerian Banks Begins New USSD Pricing Implementation

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Nigerian Deposit Money Banks (DMBs) have commenced the implementation of the approved new pricing model for Unstructured Supplementary Service Data (USSD) short code services for transacting mobile banking services.

All the banks involved in USSD transaction are now informing their customers that the new fee of N6.98 kobo has taken effect from today once a customer uses the USSD protocol to make payment/transfer.

Also, one of Nigeria’s biggest lenders, Guaranty Trust Bank (GTBank) this afternoon sent out an email to their customer titled “Important Update on USSD Transactions”. The statement reads, “Please be informed that you are now required to pay a fee of N6.98 to your mobile network provider for every banking transaction carried out on all USSD banking platforms.

“This means that when you send money to anyone using USSD, a fee of N6.98 will be charged to your bank account, which is in turn remitted in full by your Bank, to your mobile network provider. Please note that Airtime and Data purchases via USSD are exempt from this charge on USSD platforms.”

It should be recalled that on March 16th, 2021, the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) released a new pricing model for USSD short code services.

A joint statement signed by Osita Nwanisobi, Head, Corporate Services, CBN and Dr. Ike Adinde, Director, Public Affairs, NCC, then stated that “Effective March 16th, 2021, USSD services for financial transactions conducted at DMBs and all CBN – licensed institutions will be charged at a flat fee of N6.98k per transaction.

Recall that Mobile Network Operators (MNOs) and Deposit Money Banks (DMBs) have had protracted disagreements concerning the appropriate USSD pricing model for financial transactions. This resulted in the accumulation of outstanding fees to the tune of N42 billion for USSD services rendered leading to threat of service withdrawal by the MNOs.

According to the agreements reached, USSD services for financial transactions conducted at DMBs and all CBN – licensed institutions would be charged at a flat fee of N6.98k per transaction, thus replacing the old per session billing structure, ensuring a much cheaper average cost for customers to enhance financial inclusion. This approach, the two regulators said, was transparent and would ensure the amount remains the same, regardless of the number of sessions per transaction.

SiliconNigeria had exclusively on the morning of March 16, 2021 reported that:

  • “That End-User Billing would be scrapped and replaced with Corporate Billing for USSD.
  • It was also agreed that session charging be scrapped for Transaction cost charging.
  •  They agreed on N1.63k floor price and N4.50 price cap while a flat fee of N6.98k will be for the transaction.
  •  Banks will now charge customers for the USSD transaction doing on their accounts and settle the telecom operators.”

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Financial

Nigeria’s SEC Grants Volition Cap License to Kickstart Fund Management 

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Volition Cap, an asset management company empowering the hardworking middle-class to create wealth, announced today that it has secured a fund management license from the Nigerian Securities and Exchange Commission (SEC), as of December 2022.

This license allows the company to operate as a registered fund manager in Nigeria, as it prepares to launch a suite of retail and institutional investment products for Africans living on the continent and in the Diaspora.

Founded in 2018, Volition Cap is a game-changing asset manager that leverages traditional cooperatives, a model it created through Volition Cooperative, a licensed multi-purpose cooperative making investing stress-free for its members.

By leveraging technology to distribute products, Volition Cap will reduce the cost of investment services and the challenge of easy access. With the credibility and trust that an SEC license confers, this home-grown business is poised to scale its bespoke products across Africa and the Diaspora.

Subomi Plumptre, CEO of Volition Cap, said, “Our company was founded by entrepreneurs who truly understand the daily struggles of the middle class. From our operation’s inception, we have focused on empowering this group to attain financial success. The SEC license is a significant milestone for us as we introduce retail and institutional products to drive economic growth.” 

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Financial

QNET Creates Initiative To Increase Financial Inclusion In Youth Communities 

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Global e-commerce based direct selling company, QNET is working to increase financial inclusion in youth communities through its signature educational programme called FinGreen.

FinGreen aims to boost financial inclusion in underserved communities by empowering individuals with the skills required to be financially confident, aware, and savvy through its three pillars: assessing target communities, training them, and transforming participants into financial literacy advocates.

One of the programme’s first ambassadors, Anuoluwapo Ayoola, is sharing her newly gained financial skills and knowledge with 70 university students at a workshop she organised in Abuja about educating other young people about the importance of financial literacy as an essential life skill.

She said, “I am thrilled to have organised a financial literacy workshop at the University of Abuja, with the generous support of QNET. Financial literacy is not just about managing money. It’s about creating a better future for ourselves and future generations. As an ambassador of FinGreen, I’m excited for more opportunities to educate my peers on why financial education and literacy are so important!”

Ayoola based her financial literacy workshop on campus at the University of Abuja on the insights and understanding she gained as part of the pilot cohort to complete the first phase of FinGreen trainings, which kicked off in Nigeria in June of 2022. She designed the first module of her workshop to challenge the assumptions on financial literacy, educating the 70 participants on how they can adjust their mindset to utilise financial knowledge for their benefit.

The second module drew on Ayoola’s experience as a student, where she shared practical strategies and tips on how participants can manage their finances as students and as working adults. This will be crucial to help participants manage their financial sustainability and investment, seeing as many Nigerian students bear significant debt due to the increasing cost of tertiary education.

Mr. Biram Fall, the regional general Manager of QNET Sub-Saharan Africa, said, “We are honoured to support Anu Ayoola and the University of Abuja’s Financial Literacy Workshop. With the constantly shifting financial landscape and the digitisation of financial services, young people need to be equipped with the necessary knowledge and skills to make informed decisions about their money. Not just that, we want to continue helping young people, like Anu Ayoola, develop critical thinking and problem-solving skills and foster a sense of responsibility and leadership through FinGreen.”

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Financial

US Investigates Mastercard Debit Card Programme

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Mastercard says the Department of Justice is investigating potential anticompetitive behaviour related to its debit card operations.

In an SEC regulatory filing, the payments giant says that last month it received a civil investigative demand from the DoJ seeking documents and information regarding a potential violation of the Sherman Act, a competition law.

“The CID focuses on Mastercard’s US debit program and competition with other payment networks and technologies,” says the filing.

In 2021, the DoJ began a similar investigation into Visa and whether the company had restricted the ability of merchants to send debit transactions through less expensive networks.

According to Bloomberg, in January the justice department issued more CIDs to Visa seeking additional documents and information.

Mastercard CFO Sachin Mehra tells Bloomberg: “It’s not surprising that the DOJ would request information from other players in the debit space.”

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