Telecoms operators surprised a panel of regulatory councillors yesterday, saying that allowing users to be paid back for unused minutes or data will cause a rush of money laundering in SA.
The operators' concerns follow a code of conduct on handset subsidies, released by the Independent Communications Authority of SA (ICASA), which governs the way operators need to treat subscribers using their services.
The code says operators are not allowed to set an expiry date on data or minutes that customers have not used through any given month, but rather allow them to keep them until they decide to terminate their contract.
The code also says customers should be credited for unused minutes and data when they decide to switch to another provider.
Speaking during the public hearings process on the code yesterday, Neotel and Cell C said paying back the subscriber for unused minutes could provide the perfect vehicle for criminals to launder money.
Cell C's regulatory team explained that customers could buy a service with free minutes with “dirty money” and wait until the contract term expires, at which point they can reclaim the money from the unused free minutes.
Network troubles
Other concerns also raised by the operators relate to the roll-over of unused data and minutes. All the operators speaking at yesterday's hearings said that not providing an expiry date on minutes could cause havoc for the networks.
MTN's chief corporate services officer, Robert Madzonga, explained that, if customers are allowed to hold onto free unused minutes until their contract expires, there will be a lull in usage during contract periods and a rush of use when the time comes to lose the minutes.
He said networks are planned on a minute time period, meaning that quality of service will drop if there is a rush to use up minutes. Madzonga noted that planning for that kind of capacity will be difficult, if not impossible.
Money troubles
In a candid presentation, MWeb was the only company to admit the roll-over of minutes would actually have a financial impact on the operators.
Speaking on behalf of the company, Cliffe Dekker Hofmeyr telecoms director Kathleen Rice explained that, if telecoms companies allow roll-over of data indefinitely, customers are likely to buy less data, which would lead to financial implications for local telcos.
In response, ICASA chairman Paris Mashile asked: “Are we here to protect the revenues of telecoms operators, or are we here to protect the consumer?”
Rice explained that if operators felt enough of an impact from the roll-over, then it would make it difficult to operate effectively. She said there was a real possibility that it would lead to several operators closing down, leaving less competition in the market.
Consumers will now have to wait and see whether the regulator will allow users to keep free minutes, or whether operators will get their way.
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