MTN, one of African biggest cellular service providers, is racing against time to ensure that its database complies with Nigerian law so as to prevent up to 30 million subscribers from being cut off.
The Nigerian government has stopped the sale of new sim cards and instructed telecommunication companies to ensure that all the active sim cards are linked to an identity number. All sim cards that are not linked with a nine-digit Nigerian ID number by December 31 will be cut off.
And that is not the end of trouble for cellular phone companies. The Nigerian authorities have warned that if telecom companies do not comply, they risk being stripped of their operating licences, a move that could ruin the companies.
Earlier this month the Nigerian national communications regulator ordered all mobile operators in the country to immediately halt the sale, registration and activation of new SIM cards to enable the rollout of an industry-wide audit to ensure that mobile operators had the identity number of every sim card sold and serviced.
Mazen Mroue, MTN Nigeria’s chief operating officer, told BusinessInsider SA that the company was this week granted a new special licence to allow it to begin capturing and validating customers.
The company has also placed orders for about 14,000 devices to enrol and capture the ID numbers of all their subscribers. The devices should assist in registering 448,000 registration on a working day, in a process expected to take months.
Business Insider SA reports that the new SIM card ultimatum is the latest in a long line of battles that have bloodied MTN in Nigeria since the company entered that market almost two decades ago. It has faced massive problems with the authorities along the way:
- Five years ago, it was slapped with a fine of more than $5 billion for having failed to disconnect 5 million SIM cards that belonged to unregistered users. The fine was later reduced to $1.7 billion.
- In 2018, the Nigerian central bank accused MTN Nigeria of illegally paying $8.1 billion in dividends to its parent company in SA between 2007 and 2015 – and ordered it to pay back the money. In the end, MTN made a “resolution payment” of $53 million.
- A few months later, Nigeria’s attorney general, issued MTN with a $2 billion tax bill related to the payment of foreign suppliers. This was later withdrawn.
In exchange for various agreements, MTN has made large investment pledges and listed on the Nigerian stock exchange last year.
