In a bid to maintain fair competition and safeguard consumer rights, the Federal Government of Nigeria, acting through the Federal Competition and Consumer Protection Commission (FCCPC), has taken decisive action against Point of Sale (PoS) operators. Responding to the Association of Mobile Money and Bank Agents in Nigeria’s (AMMBAN) implementation of a new pricing model for PoS transactions starting July 17, 2023, the government has issued a stern cease-and-desist order.
Central to the order is the imposition of a significant N1 million fine on individual PoS operators found to be in violation of the law. Additionally, corporate entities operating PoS services face an even more substantial penalty, with fines of up to N10 million.
The FCCPC’s Executive Vice Chairman and Chief Executive Officer, Babatunde Irukera, clarified that the commission does not intend to stifle the prerogative of PoS service providers to set their prices. Instead, the goal is to ensure that these prices align with the principles of fair competition and consumer protection as enshrined in the Federal Competition and Consumer Protection Act 2018.
Under Section 127 of the Act, pricing practices that are manifestly unjust or exploitative are explicitly prohibited. The commission acknowledges and encourages pricing methodologies that result from free market forces in a competitive and undistorted market environment.
However, the FCCPC has found no evidence suggesting a lack of competition among PoS operators in Lagos or elsewhere. Hence, the commission maintains that the imposition of illegal prices undermines fair market practices and warrants strict regulatory intervention.
The cease-and-desist order serves as a clear warning to PoS operators associated with AMMBAN to refrain from engaging in any conduct that constitutes an infringement of the law. The government’s stance on enforcing the law has been unwavering, and the N1 million fine for individuals underscores the severity of violations.
The FCCPC had initially taken a cautious and collaborative approach, but with the persistence of the pricing dispute, it had no choice but to escalate its response. The commission’s Order & Notice (ONC) has been served on AMMBAN, and members are urged to comply with the order to avoid penalties.
While the FCCPC acknowledges the importance of supporting small businesses, it reiterates that adherence to the law must remain a top priority. Any PoS operators or AMMBAN members found to persist in illegal pricing practices may also face additional consequences, including the prohibition of merchant services and privileges.
As the situation unfolds, the industry will be closely watching how PoS operators respond to the cease-and-desist order. Compliance with the law and fair pricing practices are vital to fostering a competitive and consumer-friendly market environment for all stakeholders.
Source: The Punch Nigeria
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