The Federal Competition and Consumer Protection Commission (FCCPC) has barred PoS operators in Nigeria from implementing the recently announced increase in charges for PoS transactions amidst mixed reactions.
The Commission in a statement released on Wednesday and signed by its Chief Executive Officer, Mr. Babatunde Irukera, said the Federal Competition and Consumer Protection Act (FCCPA) does not allow any trade group to fix price in a way that is capable of distorting the market.
While warning the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) not to implement the announced prices, Irukera said any attempt to go ahead would be met with penalties as spelt in the FCCPC.
While noting that the FCCPA frowns at price fixing by any trade group in Nigeria, Irukera said,”The Federal Competition & Consumer Protection Act (2018) (FCCPA) recognises; indeed encourages the prerogative of businesses to organise in, and as trade associations for acceptable purposes, such as ensuring and enforcing applicable standards and best practices, as well as a measure of self-regulation within the profession or trade.”
However, the same FCCPA copiously and extensively limits the scope and extent of such collaboration, particularly to exclude coordination with respect to the scope or supply of services and price of services.
The FCCPA expressly prohibits any price-fixing or agreement among undertakings (whether bilaterally or multilaterally) or by undertakings acting in consensus on the platform, or under the aegis of an association to fix prices, coordinate supply or any other commercially sensitive factors that can limit or substantially prevent competition; or otherwise distort the market.
“An aspiration by members of a profession or businesses in a trade association to prevent fraud; excessive or unjust prices is laudable, however, fixing prices is not an acceptable or even proven way to accomplish these goals.
On the contrary, fixing prices distorts the market, prevents innovation and efficiency and does not redound to the benefit of consumers or other businesses except the participants of such illegal conspiracies or conduct,” noted the FCCPC DG.
The Commission is also opening an investigation to ensure the purported statement by AMBANN is not truly representative or erroneous. Where evidence demonstrates that the statement is factually accurate, the Commission will take appropriate regulatory steps to address the conduct accordingly.
The Association of Mobile Money and Bank Agents In Nigeria (AMMBAN) had recently announced a unified price for PoS operators in Lagos.
The spokesman of the Lagos Chapter of AMMBAN, Stephen Adeoye, while giving the details of the unified price list for PoS transactions on Channels TV, said:”As the image maker of the Lagos Chapter of the Association of Mobile Money and Bank Agents In Nigeria, it is easy for me to give the full details of the increase.”
He explained that for withdrawals up to N1,000 and N2,400, Nigerians are expected to pay a service charge of N100 while from N2,500 to N4,000, it is N200.
Withdrawals from N4,100 to N6,400 will incur a service fee of N300 while N6,500 to N7,900 is N400 and N8,000 to N10,900 will pay N500.
Adeoye said withdrawals from N11,000 to N14,400 will attract a service charge of N600 while N14,500 to N17,900 will cough out N700 and N18,000 to N20,000 will now pay N800.
However as many consumers heaves sigh of relief with the intervention of FCCPC others are arguing that the POS operators will not be able to make ends meet as the prices of everything including running of business has escalated.
As Charles Uzodinma puts it “If other businesses are allowed to hike up their prices why not PoS operators. Everything they use in running their business like transport, cost of shop, fuel etcetera has gone up why would they not increase their price?” he questioned.
“The Consumer Agency should be cautious in this matter. We appreciate their efforts but they need to understand that prices of everything has gone up and the PoS agents cannot operate in isolation. The cost of their services must reflect the current cost of things in Nigeria,” argued Mr. Jude Shola a businessman in Computer Village, Ikeja.
However, Moshood Idebia said categorically that the FCCPC is wrong in their decision, “They need to understand the cost structure faced by the PoS operators. Cost of renting is up, cost of fuelling generator is up, data runs faster now, attendants are demanding increased pay.
“Obviously the operators must be allowed to make reasonable profit otherwise the bracketing in that sector and influx of fake currency from untraceable operators. Every other sectors are asking for price increase so why not POS operators,” he queried.
Barring his mind, Akin Akintulese a financial analyst said that POS operators cannot just jerk up their prices without due consultations from all the relevant stakeholders.
“I agree that there is need for operators to hike their prices but it should be done with consideration. The increment is far too much. It is additional burden on the already over burdened Nigerian consumers.”