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Business News of Thursday, 4 February 2016


Recharge card retailers accuse Telcos of cheating

Retailers of mobile phone recharge cards in the country have announced that from Monday, February 8, 2016 they will increase the price of recharge cards by 10% because the telcos are cheating them.

They have constituted themselves into the Mobile Money Merchants and Phone Sellers Association of Ghana (MMOMAG) and their Organizer, Edward Asafo-Adjei told Adom News the increment is a matter of survival.

He explained that while utility tariffs, transport fares, fuel prices and general cost of living is going up, some telcos keep reducing the commissions that retailers earn on the recharge cards so the only way to save their business is to increase prices by 10 per cent.

Edward Asafo-Adjei said in January, Airtel announced a 20 per cent reduction on their commissions and this month, Tigo has also announced a similar level of reduction on their commissions, without any tangible explanation.
"This is cheating," he said.

This is not the first time telcos have been accused on imposing unfair trade measures on their partners. Mobile value added service providers have also accused telcos of unilaterally imposing unfair revenue share arrangements.

"There is only one telco, which is really helping us but the rest are just cheating us and they don't care how we survive so now we need to do what is necessary to save our business," the MMOMAG Organizer said.

Edward Asafo-Adjei stated emphatically that Expresso, in particular, treats retailers like "DKM treated its customers" in reference to the recent Micro Finance scandal that hit the country.

He explained that they have invested millions into Expresso products and now it has become their loss because "now we don't even know if the company still exists after their rebranding - people are simply not buying Expresso products because their network does not seem to be working."

Adom News spoke with at least three telcos, MTN, Tigo and Airtel, and they each said they have not increased the prices of their recharge cards and advised customers not to buy recharge cards at a price higher than what is written on the card.

They also asked their customers to report any recalcitrant retailers to the respective telcos through short code 100 or inform the police.

But Edward Asafo-Adjei insisted that "we have made the telcos who they are today, so if now that they are rich they want to squeeze us and call the police to arrest us then they can go ahead and see who will retail their cards."

He said nothing the telcos would do can stop them from increasing the prices so far the telcos also keep reducing retailers' commission on the recharge cards.
"They can send the police on us - but they should remember that some police men tried the recharge card business and it collapsed because they could not make ends meet," he said.

Even though the MMOMAG Organiser did not mention which one telco has been good to them, MTN has said they have not reduced the commissions of the retailers so they do not have justification to increase the price of MTN cards.