Remove arbitrage to eliminate SIMBOX fraud— CEO, MTN

MTN PIXMTN Ghana has called for the removal of the arbitrage between international termination rates and local call rates to stop the SIMbox fraud problem in the country.

It cited Nigeria and South Africa as countries which have no issue with SIMbox because their arbitrage is $0.04 and 0.00, respectively.

Speaking at the company’s stakeholders and media forum in Accra on Tuesday MTN Ghana’s Chief Executive Officer, Mr. Serame Taukobong, said the current $ 0.16 being charged by Ghana made SIMbox fraud attractive to fraudsters.

The forum sought to share an overview of MTN’s business performance in the previous year and our focus for the year 2015.

“The removal of the fixed price will result in increase in international traffic to Ghana, higher taxes for the government and less profit for the SIMbox, leading to reduction/elimination of bypass,” he said.

SIMboxing refers to the activity of routing traffic via illegal termination devices which channel national or international calls away from being terminated on mobile network operator networks and delivering them as local calls.

SIMbox fraud was identified in the Communications Fraud Control Association’s Global Fraud Loss Survey Report, 2013 as one of the top five fraud types facing the global mobile telecommunications industry, and costs the industry over US$3 billion per year. MTN estimates it loses approximately GH¢34 million annually to SIMboxing.

The related annual loss for the government of Ghana would be approximately GH¢16 million for international incoming traffic that should have been terminated on MTN’s network alone.

In addition to direct financial losses, SIMboxing compromises cellular network infrastructure by overloading local base stations and causes customer dissatisfaction as call quality can be degraded and subscribers who receive SIMbox calls are unable to identify the caller prior to answering the call.

Mr. Taukobong said there was the need for the country to take a cue from countries where SIMbox does not exist to save Ghana and the telecom industry.

Giving the performance of the company in 2014, Mr. Serame said the company recorded a subscriber growth of 7.1 per cent and 22.8 per cent increase in data subscribers.

Data subscribers he said contributed 21.8 per cent contribution to the MTN Group revenue for the period under review.

He said MTN’s mobile money subscribers also increased to 50.1 per cent due to expanded distribution base and product range.

The CEO said he was very optimistic about the prospects of the company this year, adding that MTN Ghana planned to invest GH¢460 million in total network and information technology in 2015.

On the company’s contribution to government revenues he said “MTN Ghana total payments amounted to GH¢605 million in 2014.”

Going forward he said the company would focus on SME, public sector and financial services customers, adding that, “We would also leverage MTN extensive infrastructure with 22 operations and 47 data centres.”

By David Adadevoh

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