The Nigerian Communications Commission (NCC) is set to publish the names of 18 banks that have failed to clear outstanding debts totaling N200 billion for using Mobile Network Operators’ (MNOs) Unstructured Supplementary Service Data (USSD) platforms.
The telecom regulator is also preparing to suspend USSD services for the defaulting banks within two weeks, a move that could significantly disrupt banking services for millions of Nigerians, especially those without internet access.
Industry sources revealed on Monday that only four banks have complied with the payment terms outlined in a December 2023 joint directive by the Central Bank of Nigeria (CBN) and the NCC. The directive required banks to settle 60% of their pre-API (Application Programming Interfaces) invoices by January 2, 2025, and agree on payment plans with MNOs. However, the majority have failed to meet these obligations.
Pre-API invoices refer to debts accrued for USSD services before the implementation of APIs in February 2022. Prior to APIs, billing for USSD services was less standardized, often leading to disputes between banks and telecom operators.
To minimize disruption for customers, the NCC plans to include guidance in its public statement, advising subscribers on how to switch to compliant banks to maintain uninterrupted access to USSD banking services.
This announcement is the latest effort to resolve a long-standing dispute over unpaid USSD debts. Telecom operators have repeatedly raised concerns about the financial sustainability of USSD services due to the unpaid debts and have previously threatened to withdraw the service entirely.
Electronic payment data from the CBN highlights the critical role of USSD services. Between January and June 2024, 252.06 million transactions, worth N2.19 trillion, were conducted via USSD platforms—a sharp increase compared to the full-year 2023 figures, which recorded 630.6 million transactions valued at N4.84 trillion.
Initially designed by telecom companies for airtime and subscription services, USSD has become a vital tool for banking, offering services without the need for internet connectivity.
Telecom operators are frustrated with the slow repayment process. According to the Chairman of the Association of Licensed Telecom Operators of Nigeria (ALTON), Gbenga Adebayo, smaller banks have started settling their debts, but major lenders—responsible for the bulk of the outstanding amount—remain uncooperative.
“We are seeing payments from smaller players, but the big banks, which owe the most, have not been forthcoming,” Adebayo stated. “We are now waiting for intervention from regulators, including the CBN and NCC, to resolve the issue.”
In October, telecom consultant Ejike Onyeaso highlighted the growing tension between banks and telecom firms over inadequate payments for services like USSD. “Banks generate significant revenue from USSD services and should compensate telecom providers accordingly,” Onyeaso said, warning that a suspension of USSD services could disrupt banking operations across the country.
The NCC’s upcoming action underscores the urgent need for resolution to prevent further disruptions and ensure the sustainability of USSD services in Nigeria.
