Page 194 - ITU-T Focus Group Digital Financial Services – Technology, innovation and competition

ITU-T Focus Group Digital Financial Services
Technology, Innovation and Competition

5.2.2.3 Country examples

Bangladesh

MNOs require approval from Bangladesh Telecommunications Regulatory Commission (BTRC) to provide USSD
connectivity to the banks they partner with. Given the bank-driven regulatory framework, MNOs in Bangladesh
indicate that they are not very incentivized to offer cheap USSD access or to enter into partnerships with banks.
Access to USSD is provided on revenue sharing basis. That is, the MNOs are compensated at a very nominal
rate for only those USSD sessions where the DFS providers earn revenue.

Colombia

After negotiations between banks and MNOs failed to resolve bank complaints over USSD pricing and access
from MNOs, the Colombian telecommunications regulator, the Comisión de Regulación de Comunicaciones,
mandated access to USSD and introduced a case-by-case resolution of complaints about price and quality. 91
Pakistan

MNOs are reportedly only willing to provide USSD access to their partner microfinance banks, which are
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effectively part of the same corporate group.
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Philippines

The two main MNOs in the Philippines are Smart and Globe. Each have their own DFS operations, while Globe
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also provides USSD to BankO, which it partly owns. Similarly, SMART owns 40% of mBank and provides it with
USSD access. Other banks have reportedly struggled to obtain USSD access from these MNOs. 95

Uganda

Uganda has no separate competition law. DFS SP Ezee Money sued MNO MTN Uganda for denying it access
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to its USSD gateway, and for thus breaching provisions of the Uganda Communications Act of 2013 which
prohibits anti-competitive behavior between companies licensed to provide communications services. MTN’s
main defense was that Ezee Money is not a licensed communications SP protected by the Act, such that the
law did not apply to it. The Commercial Court judge ruled however that Ezee Money’s money transfer services
were communications services, although Ezee Money is not registered. It awarded Ezee Money Sh 2.3 Billion
(US$662,000) in damages. MTN Uganda has reportedly commenced an appeal.
Besides the refusal to allow access, DFS SPs have complained about ‘unjustifiably high’ or unfair revenue share
structures for USSD session fees. These, in the view of the Uganda Communications Commission (UCC), may
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be designed to foreclose independent DFS OSPs from the downstream DFS market segment. 98
Zambia

Over The Counter (OTC) DFS SP Zoona sued MNO MTN Zambia for refusing Zoona access to its USSD gateway.
The Competition and Consumer Protection Commission found MTN to have been engaging in anticompetitive
behavior and fined MTN 2% of its annual turnover. The ruling has reportedly been appealed. 99

91 Hanouch & Chen (2015) ibid
92 CGAP (2014) ibid
93 Hanouch & Chen (2015) ibid
94 CGAP (2014) ibid
95 ibid
96 New Vision (2015) MTN Ordered To Pay Ezeemoney Sh2.3b Over Sabotage, available at https:// goo. gl/ y0FxA4
97 UCC (2016) Communication to the TIC WG
98 ibid.
99 Personal communication with Zoona, August 2016; Personal communication Competition and Consumer Protection Commission,
September 2016.

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