N42bn debt: Banks refute owing MTN, other Telcos — Wigwe

Nigerian banks are not indebted to MTN Nigeria and other phone companies for using telecommunication platforms to provide payment services, a bank chief executive said.

“There is no such thing as an obligation due from banks to telcos,” Herbert Wigwe, chief executive officer of Access Bank Plc, said on an investor call in Lagos.

“We chose not to make a public statement out of it because it is not appropriate for us to be found fighting with telcos in public,” he said on Thursday.

Wigwe is the head of a team of bank CEOs that has been in discussion with MTN Nigeria to resolve a dispute that led some banks to cut off the company from their banking platforms last week.

This was after MTN, the West African nation’s biggest telecom services provider, reduced a commission charged on airtime purchases through banking channels by almost half to 2.5per cent.

The action against MTN was an escalation of an ongoing dispute between lenders and telcos in Africa’s largest economy over fees chargeable on services carried out on each others’ platforms. Telecom operators through their umbrella union, the Association of Licensed Telecommunications Operators of Nigeria, threatened last month to disconnect banks from providing payment services on telco platforms until they paid a N42 billion or $103 million debt allegedly due to its members from end-user billing.

The threat was called off after the Central Bank of Nigeria and the Ministry of Communications and Digital Economy intervened in the dispute leading to an agreement to charge a fixed amount and also settle any indebtedness for past services.

The telecom companies are asking the banks to remit money to them even for transactions that did not take place, Wigwe said. “It is true that they continue to provide this service but this service has nothing to do with the banks,” he said.

Access Bank’s transactions value on telco platforms more than doubled to N1.9 trillion in 2020 from N891billion a year earlier, according to an emailed presentation. The volume of transactions rose 80% to 590 million as more customers adopted the technology for payments.\