The Telecom Regulatory Authority of India (TRAI) on Wednesday has proposed to remove charges on Unstructured Supplementary Service Data (USSD) messages for mobile banking and payment services to promote digital transactions.
The USSD messages get displayed on the screen of mobile phones and are not stored like SMSes. This technology is widely used to display balance deduction in mobile phones where a message pops-up on the device screen after a call or outgoing SMS.
At present, the sector regulator has capped the price of a USSD session at 50 paise where each session can be completed in eight stages.
“The present tariff per USSD session for mobile banking offered by telecom service providers (TSPs) is several times higher than the average tariff for one minute of outgoing voice call, or one outgoing SMS. The relatively high charge for USSD is thus acting as an impediment in increasing the number of transactions despite significant improvement in success rate of transactions,” TRAI said in the draft ‘Telecommunication Tariff Order, 2021’.
Considering the decline in charges for other services, the rationalisation of USSD charges is required to increase the number of USSD transactions, it said.
The recommendations
The suggestion to remove charges has been made by a high-level committee on deepening of digital payments constituted by the Reserve Bank of India (RBI) with a view to encouraging digitalisation of payments and enhancing financial inclusion
The recommendations made by the committee are supported by the Department of Financial Services (DFS).
TRAI said following a request from the DFS to the Department of Telecommunications (DoT) in this regard, it has analysed the issue from various aspects and is of the view that in order to protect the interests of the USSD users and promote digital financial inclusion, rationalisation of USSD charges is required.
“In line with the foregoing, the Authority proposes to revise the framework for USSD based mobile banking and payment services by prescribing a “Nil” charge per USSD session for mobile banking and payment service, while keeping the remaining aspects unchanged. The Authority may review the charge after a period of two years, based on experience gained,” it added.
It has invited views of stakeholders on the draft proposal by December 8.
