PTA reduces MTR by 28.5%

Notification says decision will come into effect from Jan 1, 2022

The Pakistan Telecommunication Authority (PTA) on Friday announced reduction in the Mobile Termination Rate (MTR) from 70 paisas per minute to 50 paisas from January 1, 2022.

The MTR is the cost charged by a mobile operator for completing an outgoing call on its network. It is one of the three components in the cost of providing telephone service. Firstly, connecting charges; secondly, duration charges; and finally, termination charges.

According to a notification by the PTA, the rate shall be further reduced to 40 paisas per minute from July 1 next year.

The official statement said that the reduction in the MTR has been made after thorough consultation with the telecom industry.

“The PTA is of the view that lowering of MTR would allow more competitive and innovative offerings such as free minute off-net bundles for the consumers.”

The PTA said that it expected the move would make the market "healthier and beneficial" in terms of lower tariffs for making off-net calls, adding that it would also benefit smaller operators in terms of reduced net payments to be made to the bigger operators.

In July, the statement said, the PTA issued a consultation paper wherein it was observed that the current MTR of 70 paisas per minute in Pakistan was higher than the benchmarking results of the MTR determination of 2018 and the MTRs in regional countries.

Further, it added, the PTA had also received requests from telecom operators to review the existing MTR. "Majority of the responses received supported the PTA’s recommendation to lower the MTR. However, there were opposing responses too."

After hearing the industry and conducting thorough analysis, according to the statement, the PTA determined the MTR for all types of calls – local, long-distance and international incoming calls – terminated on mobile networks from other mobile networks or fixed networks in Pakistan and Azad Jammu and Kashmir (AJK) to be 50 paisas per minute from January to June 2022, 40 paisas per minute from July 2022 to June 2023 and 30 paisas per minute from July 2023 onwards, the statement concluded.