Telecommunication subscribers across Nigeria have condemned the high interest placed by telecommunication operators in the country on data loan services.
Nigeria has four main telecommunication operators which include MTN, 9mobile, Airtel, and Globacom. Nigerians access the internet with their mobile phones which have helped to improve the revenue gotten by these mobile operators.
iBrandTV findings also show Nigerians actually subscribes to data loans either based on an emergency or as a result of a lack of finance to take care of the package they want.
For instance, an airtel customer can borrow by Dialing *500# on your mobile phone. For Globacom, to subscribe for a data loan which the company tagged as ‘Borrow Me Data’ one can do so by dialling *321# and following the menu options, while for MTN once can Dial *606# and select XtraTime.
Although 9Mobile does not allow subscribers to borrow data yet, you can borrow airtime by dialling *665*amount#, and then convert it to data. First of all, only eligible individuals are allowed to borrow airtime.
The service will then push real-time Data credit to all eligible subscribers in line with the stated eligibility criterion. The customer will repay the Data credit whenever airtime recharge is made.
iBrandTV also gathered that telecommunication subscribers pay about 13.31 per cent as an interest rate for data loans.
Nigerians expressed their dissatisfaction in separate interviews with our correspondent lamenting that some of the telecom operators in the country charge as much as 15 per cent on data loans given to their customers.
Mr Habeeb Olusanjo, a telecoms subscriber, said the operators did not understand the effect of the present economic situation on the average Nigerian.
“It seems they don’t know what people are going through in the country. I consider it absurd, the same way I feel about borrowing credit on their network,” he said
Also speaking, Mr Collins Adeoluwa, a phone accessories trader at Oyingbo market in Lagos mainland, said that data loan is a good business for telecommunication operators in Nigeria because many people depend on data loans to be active on social media always.
“Some people cannot do without data, to maintain their status on social media they borrow data when they do not have money for a subscription,” he said.
Mrs Folasade Lawal, a cloth trader, said that some business owners cannot afford the effect of running out of data on their businesses, therefore, they do not have a choice than to borrow data when they cannot subscribe irrespective of interest rate on such data.
“Some business progress depends on the availability of data, for advertisement, placing of the order, shopping and online banking, I feel that data loan is a huge rip-off on these sets of people,” she said.
Another subscriber, Mr Kunle Hammed, said that he prefers to buy data from resellers which give him more data at a lower cost instead of borrowing data.
According to MTN’s annual report for the quarter ended June 2021, the company reported a massive 69.6% growth in its Fintech segment which comprises its MoMo Agency business and its Xtratime airtime credit service business.
MTN’s FinTech segment was the fastest growing business rising 69.5 per cent to N31.6 billion in the first half of 2021.
MTN’s FinTech business includes Xtratime, its use now pay later business, and MoMo its agency business.
Airtel earned close to $36 million from this segment. Globacom, the second-largest telecoms operator in Nigeria after MTN, also offers its own airtime credit scheme.