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USSD: Telecoms Operators Threaten Service Withdrawal, Debt Hits ₦200bn


CEM REPORT, FINANCE | The end to tension between the telecommunications operators and deposit money banks (DMBs) seems far from sight over the payment of unstructured supplementary service data (USSD) service offered to bank customers..

The bill which presently stands at ₦200 billion, may force telecommunications operators to withdraw the USSD service from bank customers who depend on the simplicity of the service to perform cashless transactions.

Gbenga Adebayo, Chairman Association of Licensed Telecommunications Operators of Nigeria (ALTON), decried the effortless compliance of DMB to offset the debt despite multiple interventions and meetings by the Ministry of Communications, Innovation and Digital Economy, Central Bank of Nigeria (CBN), and Nigerian Communications Commission (NCC), by the previous administration.


The operators stressed that the debt must be paid in total and would not hesitate to block debtor banks from accessing the service anytime soon.

“Of course, we can confirm that there had been talks, largely before now, but no progress has been made. The matter needs to be resolved as fast as possible to avoid service shut down.”

Adebayo stated that the debt is impeding the growth of the industry and may lead to the collapse of the industry, adding that the value of the USSD debt would keep rising based on the fluctuating challenges confronting foreign exchange stability in the country.

The fight over USSD charges between banks and telcos has been fruitless. In an earlier CEM report, banks indicated no interest in being involved with end-user fees imposed by telcos; therefore they recommended charging customers directly instead of going through them.

Segun Agbaje, the Chief Executive Officer of Guaranty Trust Holding Company Plc, has expressed his opinion on USSD technology, stating that it is a clumsy and outdated technology. He believes that the only way to achieve financial inclusion in Nigeria is by significantly reducing the cost of data.

His statement follows claims by the CBN and NCC that withdrawal of the USSD service will hamper the Federal Government’s 95 per cent financial inclusion target of 2024.

According to him, the ongoing dispute between banks and telcos regarding USSD is nothing but a distraction from the real issue – high data costs in Nigeria, a situation he says does not bode well for financial inclusion or economic development within Nigeria.

Agbaje argued that the ongoing fight between banks and telcos over USSD is nothing but a distraction by telecom firms from the real issue of high data cost, stressing that reducing data costs would be more effective than using USSD technology because it is superior.

He emphasizes that while some may believe otherwise, USSD technology cannot provide an answer to achieving financial inclusion goals in Nigeria. Instead, lowering data costs should be prioritized as Nigerians pay more compared to other economies globally; they are exploited this way making it difficult for people who need access to banking services without breaking their bank accounts.

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