Mission impossible for MTN in Nigeria?

MTN Group CEO Ralph Mupita

MTN is in a race against time to get about half its subscribers to comply with the Nigerian government’s stipulation that their Sims be connected to their ID numbers by the end of the year.

This follows minister of communications & digital economy Isa Ali Ibrahim Pantami giving mobile operators two weeks from 16 December to get the West African country’s 200 million mobile subscribers to register their national identification numbers with their Sims.

The latest ruction in the group’s largest market saw its share price fall over 7% to R61.44 on Thursday.

The problem is that there are only about 42 million Nigerians with ID numbers. Of this, about half are MTN subscribers

The problem is that there are only about 42 million Nigerians with ID numbers. Of this, about half are MTN subscribers. According to MTN’s latest quarterly update, it has about 75 million subscribers.

Outgoing MTN Nigeria CEO Ferdi Moolman cautioned during a conference call with investors that the “full verification process” of how much of its subscribers have ID numbers still needs be done and that it is just assuming that half of them did not have them.

In spite of the challenges, the minister, the Nigerian Communications Commission, the National Information Technology Development Agency and the National Identity Management Commission were committed to the registration process.

Blocked

“After the deadline, all Sims without NINs (ID numbers) are to be blocked from the networks,” they warned in a statement.

MTN Group CEO Ralph Mupita put on a brave face during the call with investors, saying it is working with the Nigerian authorities and the new rules could benefit the operator over the long term as the company would improve its “know-your-customer” processes.

Even so, by its own admission, MTN acknowledged it won’t meet the deadline. Despite getting a licence to register ID numbers and 14 000 devices to do so, it can only process four subscribers an hour.

With the deadline clearly going to be missed, mobile operators are now lobbying for a six-month extension. The operators’ call in this regard has been echoed by the country’s lawmakers, who passed a resolution on Wednesday in the house of representatives calling for a 10-week extension.

MTN, which has had numerous disputes – costing into billions of rands – with the Nigerian authorities over the years, was at pains to say it was working closely with said authorities. It is even on a state-led task team, which will assess if the implementation can be done in two weeks.

Incoming MTN Nigeria CEO Karl Toriola said if the deadline is extended, it could register all its subscribers in as little as four months.

The Nigerian government is not insensitive to the challenges faced in the country

Moolman said the Nigerian government is not blind to the challenges the operators face. “Although the statement (put out by the authorities) is very harsh and very direct, the Nigerian government is not insensitive to the challenges faced in the country.”

Though MTN’s earnings are certain to be hurt if it is forced to deregister a large portion of its subscribers, it pointed out that there some factors that mitigate against this loss. Mupita said the majority of its business is generated by its “higher value” subscribers, who either have ID numbers or are easy to register.