Why does the app need the location permission to access SSID/BSSID?
Since iOS 13, apps that want to access SSID (Wi-Fi network name) or BSSID (MAC address of the Wi-Fi interface) are required to have the location permission. Apple's reason for protecting this information with the location permission is that your Wi-Fi network's SSID and BSSID are specific to your location — you usually keep your router in one place.
Any app with access to SSID/BSSID and location can upload this data to a server where it can be stored in a database. An example of such a database is
which contains location information about more than 600 million Wi-Fi networks.
When such databases are publicly available, any app with access to your Wi-Fi network's SSID/BSSID can easily query them and obtain your location. To protect your privacy, access to SSID/BSSID is gated behind the location permission, so apps cannot obtain your location without your consent.