Prepaid mobile subscribers will be affected by increased verification costs, says the Association of Comms and Technology.
South Africa’s mobile network operator umbrella body has slammed the Department of Home Affairs (DHA) for its 6 500% increase in the cost of biometric verifications.
It says the move is contrary to government’s own socio-economic endeavours.
This comes as home affairs minister Dr Leon Schreiber told the National Council of Provinces – during his presentation of the department’s budget yesterday – that the increase, which forms part of an upgrade to the National Population Register (NPR), was “in the national interest”.
In response to questions from ITWeb, the Association ofComms and Technology (ACT) says a large number of prepaid users change cellphone SIM cards on a regular basis because of factors such as competitive promotions, special offers and the loss or theft of SIM cards.
This, it explains, means a large portion of the 80% of prepaid subscribers need to go through the SIM card registration process on a regular basis.
“This level of churn drives millions of Regulation of Interception of Communications and Provision of Communication-related Information Act registrations monthly, meaning that even a R10 fee per transaction could cost the sector tens of millions of rands each month,” says ACT.
As a result of the biometric checks going up to R10 from the previous 15c per search, subscribers will be directly affected, ACT explains. “Without careful intervention, increasing costs will inevitably impact end-users.”
ACT also indicates there are several aspects of government’s own socio-economic initiatives that would be undermined by this increased cost, such as the Presidency’s newly-launched Digital Public Infrastructure (DPI), which seeks to streamline identity verification, enable real-time payments and enhance public service delivery.
It states this move “directly undermines” the DPI’s objectives, while noting that “international experience shows that well-implemented DPI reduces transaction costs for the private sector – the proposed fee increase would do the opposite”.
In addition to subverting the DPI, ACT argues that “affordable SIM cards are vital to achieving South Africa’s National Development Plan 2030 goals of eradicating poverty, reducing inequality and driving inclusive economic growth”.
Moreover, it states: “The Batho Pele principles require government to deliver services responsibly, manage public resources prudently, and ensure basic services like connectivity remain affordable for all citizens.”
Batho Pele aims to improve public service delivery. Introduced by the Mandela administration in 1997, it focuses on putting citizens’ needs at the heart of service delivery.
Digital-only financial services company TymeBank has argued that pushing the biometric verification price up so drastically threatens financial inclusion, especially for low-margin businesses that rely on affordable verification to serve the lower income segment of the population.
Schreiber, however, told Members of Parliament that the new NPR was implemented “in the national interest”.
The minister added that three major private sector users have already transitioned to the new service. “One private sector user has already processed over one million records through the new off-peak batch option that would previously have gone into the real-time queue and caused the system to go offline, directly contributing to a more stable NPR for all users.”
Schreiber previously stated that some users had been abusing the system, resulting in failure rates of more than 50% and that the 15c cost was “below market-related rates charged by the private sector for comparable services”.
The minister also hit back at an open letter TymeBank issued to express its concerns over the increase, arguing that the bank had been profiting at the expense of taxpayers.
