Citizens are taking legal steps against the Federal Government due to the recent increase in telecoms tariffs by 50%.
Nigerians are preparing to take legal action against the federal government due to its approval of a 50 percent increase in telecommunications tariffs, including calls and data.
In a related development, Point of Sales (POS) operators have expressed intentions to raise their service charges as well.
These positions were articulated on Monday in exclusive interviews with TNDnews by Adeolu Ogunbanjo, President of the National Association of Telecoms Subscribers, and Ogungbayi Ganiyu, National Spokesperson for the Association of Mobile Money and Bank Agents in Nigeria.
The Nigerian Communications Commission (NCC) announced on Monday that it has approved Mobile Network Operators to increase service tariffs by up to 50 percent. According to TNDnews, the Minister of Communications and Digital Economy, Bosun Tijani, indicated that telecom tariffs would rise by either 30 or 50 percent.
This decision follows a meeting where operators proposed a 100 percent increase. The recent approval for a telecom tariff hike comes 13 years after the NCC established a price template in 2013.
With the new tariff changes, Nigerians could see their costs rise significantly. For example, the price for calls may increase from N11 to N16.5 per minute, SMS rates may go up from N4 to N6, and the cost for 1 gigabit of data could rise to N431.25.
Telecommunications companies (telcos) are projected to generate N6.7 trillion annually in revenue from calls alone due to the new tariff regime. This estimation is based on 2023 national telephone traffic data, which indicated total outgoing telephone traffic at 205.3 billion minutes, while incoming traffic was 203.2 billion minutes.
In response to these developments, Ogunbanjo stated that telecom subscribers have rejected the proposed 50 percent tariff hike. He emphasized that subscribers were only willing to accept a tariff increase of 5 to 10 percent, not the 50 percent that was announced by the Nigerian Communications Commission (NCC).
READ ALSO: JUST IN: SERAP sues FG,NCC over 50% Telecom Tariff Hike.
Ogunbanjo also expressed concerns that subscribers intended to take legal action against the federal government for endorsing the 50 percent increase in electricity tariffs. He lamented that this hike would further impoverish Nigerians who are already struggling with rising costs in Premium Motor Spirit, transportation, and food, which has seen a price increase of 38.90 percent as of December 2024.
“It is unfortunate that the Minister of Communications and Digital Economy, Bosun Tijani, is leading the effort to increase telecommunications service rates. He should not be contributing to the impoverishment of Nigerians. While I understand the challenges facing the telecom sector, we agreed to a 5 to 10 percent tariff hike. If that is insufficient, telcos should seek funding from the capital market,” he said.
“We will be going to court to challenge the federal government’s decision to approve a 50 percent tariff increase, as we have presented them with alternatives. We reluctantly agreed to a telecom tariff hike, knowing we would pay more, but not 50 percent. The telcos originally requested a 100 percent increase; naturally, they want to enhance profits at the expense of subscribers. A 50 percent hike is excessive, and we simply cannot accept it. Anything beyond a 10 percent increase will result in us taking legal action.
“This tariff increase will have a colossal impact. Every business will likely raise their own prices, from large companies to ordinary POS operators, which will exacerbate the poverty faced by Nigerians,” he conveyed to TNDnews.
Impact on POS Operators
The Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) has stated that its members may be forced to increase service charges due to the 50 percent telecom tariff hike. Ogungbayi Ganiyu, the National Public Relations Officer at AMMBAN, shared this insight during an interview TNDnews on Monday.
He explained that members are primarily focused on telecom services, especially data, thus they would be significantly affected. However, he mentioned that POS operators might choose to absorb the costs associated with the increased telecom tariffs.
“The telecom tariff hike will impact our members’ operations. I’m concerned this may also lead to an increase in service charges. We haven’t formally discussed the latest tariff hike, but it may not directly affect our operations. Our members may decide to bear the financial burden of the hike. Just like bankers, POS operators deserve to be respected in the banking sector because we help them reach underserved areas,” he stated.
Worsening Poverty in Nigeria
The impending tariff hike, expected to take effect in February 2025, has been described as another policy by President Bola Ahmed Tinubu that could further impoverish Nigerians. Ogunbanjo reiterated that this increase will affect both small and large companies across the country, saying, “This tariff will be significant. Every business will increase its prices, from large companies to ordinary POS operators, which will lead to greater impoverishment of Nigerians.”
TNDnews has reported that for months, Mobile Network Operators (MNOs) have been advocating for a tariff hike. Recently, telecom operators threatened to shut down operations if their tariff rates were not elevated. MNOs are anticipated to implement the new tariff regime starting in February 2024.
