The Telecom Regulatory Authority said, “The authority proposes to modify the framework by setting a “zero” fee per session for USSD-based mobile banking and payment services as a means to protect the interests of target user groups and promote digital financial inclusion. Rationalization is a necessity for India (Male) said in his draft telecom tariff (66th Amendment) Order was notified on Wednesday.
However, it said it “may review the fee after two years based on the experience gained”. Regulator sets December 8 deadline for stakeholders’ comments new draft regulation,
NS U.S.S. D (Unstructured Supplementary Service Data) is a service that uses a short code to perform transactions or inquiries. Since it does not require a data connection, the service is used by a large number of people, mainly feature phone users, and hence is also used as a medium for no-frills banking transactions.
TRAI attributed its call for rationalization to the fact that the current tariff of 50 paise per USSD session is the average tariff for one minute of outgoing voice calls (Rs 0.04 per minute), or one outgoing SMS (Rs 0.01 per text). many times more than Message).
The relatively high fee for USSD (session), despite a significant improvement in the success rate, is “acting as a deterrent” in increasing the number of transactions.
The regulator said that “a consumer is also being charged for both successful and unsuccessful transactions,” which imposes additional financial burden given the potential popularity of USSD among rural, less-privileged and low-income groups.
TRAI in its draft order said that the Department of Financial Services (DFS) had requested to “waive off USSD charges to facilitate faster adoption of these services” by the general public – especially in rural/hard-to-reach areas – population segment. For whom the Pradhan Mantri Jan Dhan Yojana (PMJDY) account scheme was set up to drive financial inclusion.
In this context, the sector regulator said that the Reserve Bank of India (RBI) had also constituted a high-level committee on intensification. digital payment (CDDP). And a key recommendation of the panel is to “further rationalize the fee for USSD usage and make the technology more feature-rich” to increase adoption and popularity.
In fact, the USSD service is used by many feature phone users for checking balances in their bank accounts, peer-to-peer money transfers, cash withdrawals and deposits from banking correspondents in small towns and rural areas. With the increasing penetration of mobiles in rural India, mobile phones are seen as a powerful tool to promote digital financial inclusion.
In November 2016, the sector regulator reduced the per session rate for USSD-based mobile banking transactions from Rs 1.50 to 50 paise.