Page 204 - ITU-T Focus Group Digital Financial Services – Technology, innovation and competition

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

A recent report noted that aggregators in Kenya, because they do not already have a short code when they
160
go to MNOs to request services, believe that this causes negotiations with MNOs to be more challenging since
they have less leverage. This is, they said, a ‘subtle, but significant, impediment to fair access.’
161
Uganda

As noted earlier, DFS SP and aggregator Ezee Money sued MNO MTN Uganda on the basis that, inter alia,
MTN denied Ezee Money the use of short codes on its network once services had already begun. MTN’s main
defense was that Ezee Money was not a licensed communications services provider protected by the Uganda
Communications Act; and further, that Ezee Money was a new company with no prior business with MTN
and hence did not meet MTN’s trade-vetting requirements. The Commercial Court ruled that MTN breached
provisions of the Uganda Communications Act in regards to restricted and distorted competition, and awarded
Ezee Money Shs 2.3 Billion (US$637,000) in damages. MTN Uganda has reportedly begun an appeal. 162

Short Codes may be issued by UCC to the DFS SP. However this may not guarantee the SP quick activation as
there are currently no reference activation time lines mandated by the regulatory authority. Some banks and
independent TSPs and PSPs have claimed that short code activation may take more than 3 months. 163

8 Quality of service

8.1 Overview

Issues of Quality of Service (QOS) permeate the DFS ecosystem, some anecdotal and some identified by
regulatory studies.

These QOS issues relate primarily to random, dropped USSD sessions affecting DFS SPs and aggregators. As
noted by CGAP, selective degradation is technically possible, but is reportedly difficult to do and extremely
difficult to prove.
164
Even so, minimum QOS standards may be embedded in MNO-SP contracts. These may provide, in a USSD
165
context, for the provision – if and where available - by an MNO to an SP of NI-USSD, which would be automatically
initiated to resume a dropped user-initiated USSD session.

8.2 Country example

Uganda

A competition study commissioned by the UCC indicated that TSPs and PSPs reported issues with service
quality and that it was not possible for them to negotiate service level guarantees, nor be compensated for
poor QOS and dropped USSD sessions. 166

160 Mazer & Rowan (2016) ibid
161 ibid
162 Uganda has no competition law. New Vision (2015) MTN Ordered To Pay Ezeemoney Sh2.3b Over Sabotage, available at https://
goo. gl/ glTbes
163 UCC (2016) ibid
164 And as noted further by CGAP, even if a discrepancy in the quality of USSD is proven, it is not straightforward to identify the cause
of the inferior quality. The point of failure could, for example, be with the DFS provider, the USSD gateway operator, or the MNO.
See CGAP (2014) ibid
165 See ITU FG DFS (2016) QOS and QoE Aspects of Digital Financial Services, available at See http:// www. itu. int/ en/ ITU- T/
focusgroups/ dfs/ Pages/ default. aspx . The report considers the appropriate role for telecommunications regulators in ensuring
the provision of high-quality DFS and offers recommendations for telecommunications regulators on how to select Key Per-
formance Indicators (KPIs) for DFS, including technical KPIs for bearer channels used with basic phones, feature phones and
smartphones.
166 Cartesian (2015) ibid; UCC (2016) ibid

180