Concerns Rise Over “Borrow-Me-Credit” Service in Nigerian Telecom Sector

The Association of Telecom Entrepreneurs, representing Nigeria’s airtime distribution sector, has raised concerns over what it describes as excessive costs and a troubling lack of transparency surrounding the “borrow-me-credit” schemes offered by some telecom operators.

In a recent statement, the association highlighted a surge in consumer complaints about the high charges imposed by these services and the perceived opacity in how fees are structured and disclosed. Central to their concerns are several pressing questions that they argue have far-reaching implications for Nigeria’s telecom industry and the broader economy.

The association is calling for transparency around the ownership of companies that control these airtime credit services, questioning why Nigerian banks and smaller lending institutions are restricted from participating in this space. They further criticize the exclusive agreements between two leading telecom operators and a single credit service provider, arguing that this arrangement fosters a monopolistic environment that stifles competition and inflates prices for consumers.

A particularly alarming issue, according to the association, is the use of dollar-denominated contracts for services offered within Nigeria, in contravention of Central Bank regulations requiring that domestic transactions be conducted in naira. They warn that these agreements risk increasing foreign exchange outflows, thereby placing added pressure on Nigeria’s exchange rate and driving up service costs for everyday users.

The association also alleges that dollar-based contracts may allow certain operators to shift profits offshore, potentially resulting in substantial tax losses for Nigeria. They urge the Federal Government to scrutinize these arrangements, suggesting that they might enable tax evasion through profit diversions outside the country.

In an urgent call to regulatory agencies—including the Nigerian Communications Commission (NCC), the Economic and Financial Crimes Commission (EFCC), the Federal Competition and Consumer Protection Commission (FCCPC), and the Federal Inland Revenue Service (FIRS)—the association demands a full investigation. They emphasize the need for regulatory actions to promote transparency, dismantle monopolistic practices, and ensure Nigerians receive fair and affordable services.

“Ensuring transparency and competitive practices in the airtime credit sector is essential,” the association’s statement read. “Any ongoing tax leakages or profit diversions from these opaque contracts must be immediately addressed to safeguard Nigeria’s revenue streams.”

The Association of Telecom Entrepreneurs’ statement underscores a call for accountability in an evolving telecom landscape, emphasizing the need for fair practices that serve Nigeria’s economy and its citizens.

Signed by the Association of Telecom Entrepreneurs