MTN, Airtel others react as NCC proposes 12-month airtime reclaim period

The Nigerian Communications Commission (NCC) has proposed a 12-month grace period for telecom subscribers to reclaim unutilized or unclaimed airtime on deactivated lines. CEO, Dr Aminu Maida, disclosed this during a virtual stakeholder engagement forum

According to him, the management of unclaimed or unutilized prepaid credit is a significant aspect of telecoms operations worldwide. This will only affect prepaid mobile services, where consumers purchase credit in advance for voice calls, SMS and data usage.

The NCC boss stressed that managing how prepaid balances are handled when a subscriber becomes inactive is crucial for both consumer protection and regulatory compliance.

If a line is inactive (without Revenue-generating events (RGEs) for a prolonged period, it will be deactivated and its unused credit will be forfeited. The Quality-of-Service Business rules (2024) stipulate that a prepaid line without an RGE for six months must be deactivated. If the inactivity continues for another six months, the line will be recycled.

Under the proposed framework, subscribers whose lines have been churned will have a one-year window to claim unused airtime, provided they can verify ownership. According to the regulator, the initiative is directed at balancing consumer protection and maintaining an efficient telecom industry.

Another crucial conversation is whether operators should be required to refund unused airtime or whether the principle of ‘use it or lose it’ should prevail. “Our goal is to establish a framework that protects consumers while ensuring the continued efficiency and competitiveness of the industry,” the NCC boss said.

The “Use it or lose it” principle is a regulatory framework widely employed in managing public resources in the telecommunications industry. In this case, subscribers must ‘actively’ utilize their allocated resources.

Failure to do so results in the forfeiture of these resources without the prospect of a refund.

See Also: 50% telecom tariff: Senate calls for review as Nigerians struggle with rising data costs.

While the policy will enforce consumer rights, the NCC emphasised that unused airtime cannot be inherited or transferred upon a customer’s death.

The agency also recognized that the refund policy poses several challenges, such as determining the mode of refund, identifying the recipient of the refund given that the line has been deactivated, and processing claims within a reasonable timeframe.

NCC directed all operators to notify subscribers of the plan within 90 days and implement a consumer education campaign for subscribers about the new approach to managing unclaimed and unutilized recharges. 

“All unclaimed and unutilized recharges cannot be monetized, but affected subscribers may be given service options, which include voice offerings, data plans, and value-added services using the unutilized recharges after churning by the primary network and cannot be transferred across networks,” NCC added.

The proposed refund policy will be the first among other countries.

In the U.S., Mexico, Brazil, South Africa, India, Kenya, Europe, UK, the “use it or lose it” principle is prevalent, particularly in prepaid service-dominated markets. Mobile network operators (MNOs) are typically under no obligation to refund unused airtime or data on deactivated lines.

Stakeholders’ comments about NCC’s proposal

From NCC’s move to foster a fair, transparent, and consumer-centric telecom landscape with the proposed refund policy, MNOs raised concerns and recommendations during the meeting.

Airtel Nigeria noted that the policy deviates from the ‘use or lose it’ rule, referencing countries like Ghana, Mexico, and India, which are staying firm to the rule. However, it explained that if the commission considers the policy necessary, there should be terms and conditions.

The telecom operators recommended that “a subscriber should only be eligible to unutilized recharges if there were complaints of poor network, making it difficult for the affected subscriber(s) to use their airtime. Otherwise, the subscriber should forfeit the airtime recharges.”

The operator added that the compliance and education campaign should be a generic approach that the NCC and all MNOs devise.

Leading operator, MTN Nigeria, pointed out that the policy does not provide a structured framework detailing the procedural steps required for a subscriber to successfully initiate and complete a claim.

It notes that there is no indication as to whether the unused airtime will be credited to the deactivated line or a new line. Also, “there is no clear state on if each operator is expected to establish an independent claims process or if a uniform mechanism will be prescribed by the Commission.”

MTN recommended that the Commission establish a uniform and standardized claims procedure applicable to all operators to ensure consistency in implementation. The proposed mechanism should include claims submission via self-service portals, identity verification through a valid NIN– the claimant must provide a valid NIN, and operator validation where the claimant must have the same NIN information associated with the churned line.

Furthermore, MTN noted that the clause that allows for the transfer of the unused airtime balances between operators should be removed as each operator has its own unique cost structure and accounting practices, making it impractical to facilitate such transfers without creating inconsistencies and financial disparities between networks.

Another telecom operator, Smile Communications, opined that the requirement to keep unutilized and unclaimed customer balance recharges for a 1-year period without a threshold may not be practical or cost-effective, especially for very minimal amounts. It explained that holding onto ₦1 worth of unused recharge for an extended period seems unrealistic.

The operator recommended a minimum threshold, below which unutilized and unclaimed recharge balances are not required to be retained after line deactivation. “This is particularly relevant since the Guidance indicates that affected subscribers may be offered service options instead of monetized refunds,” it advised.

NCC acknowledged all issues raised and recommended, noting that the Technical Review Committee will address all concerns in due time.