‘Stronger prepaid SIMcard guideline could lead to tougher environment’
KUCHING: Despite analysts welcoming the government’s initiatives to strengthen prepaid SIM cards guideline, they project that the new rulings could potentially lead to tougher operating environment over the short-term.
The Malaysian Communications and Multimedia Commission ( MCMC) revealed in a press release last month that in collaboration with the telcos, they have recently formed an Industry Task Force for Data Verification.
This Industry Task Force for Data Verification aims to verify the integrity of prepaid subscriber’s database and to rectify unmatched data from the service provider’s database.
“This is also part of the Commission’s efforts in its review on the Guidelines on Registration of End-Users of Prepaid Public Cellular Service, to strengthen the registration process to address false registration issues, security and data integrity thus ensuring the interest and rights of consumers are being protected and looked after.
“The verification exercise which began in April and concluded at the end of May revealed, a total of 708,392 numbers were found to be unmatched. The result of the verification were then shared with the respective Service Providers on June 5, 2017 and they were given until December 31, 2017 to take the necessary action,” MCMC stated.
The research arm of Kenanga Investment Bank Bhd ( Kenanga Research) highlighted that with the aim to empower the consumer in ensuring identification information provided during registration are valid and to ensure the integrity of data, MCMC has strengthened the Guidelines for Prepaid Registration, which will be fully enforced by January 1, 2018.
While Kenanga Research concurred with the government’s initiative, the strengthening of prepaid SIM cards guideline could lead for tougher operating environment over the short-term, especially for the prepaid reload services.
The research arm pointed out that with this new guideline, users would need to provide an ID for verification before they are allowed to perform a reload. This requires incumbents to install new systems to all point- of- sales such as convenient stores, grocery shops, e-commerce or banking and others, for document verification purpose.
“The process may discouraged consumers resulting in less credit top-up and trigger another cleanup exercise in each Cellco’s prepaid segment moving forward,” it said.
“On the flip side, there is a likelihood some prepaid users may consider converting their service to the postpaid to avoid the hassle, which bodes well for Cellcos to up-sell their value-added services and provide brand stickiness in the future.”
Meanwhile, Kenanga Research noted that despite the postpaid subscribers continued to trend upwards in recent years, the overall subscriber base is still dominated by the prepaid users.