The Nigerian Communications Commission (NCC) is set to publicly name 18 banks that owe a combined debt of ₦200 billion for using Mobile Network Operators (MNOs) Unstructured Supplementary Service Data (USSD) platforms.
According to industry sources, only four banks have complied with the payment directive issued jointly by the Central Bank of Nigeria (CBN) and the NCC in December 2023.
The directive required banks to settle 60% of pre-API invoices by January 2, 2025, and agree on payment plans with MNOs. The remaining banks, however, have yet to fulfill their obligations, raising concerns about the sustainability of USSD services.
Pre-API invoices refer to outstanding payments incurred before the adoption of Application Programming Interfaces (APIs) in February 2022.
These older systems often led to billing disputes between banks and telecom operators, eventually creating a backlog of unresolved payments.
MNOs have now agreed to suspend USSD services within two weeks, a decision that could impact millions of Nigerians who rely on the service for banking transactions, especially in rural areas with limited internet access.
To mitigate this, the NCC plans to issue a public statement directing affected customers on how to switch to other banks to ensure uninterrupted banking services.
Telecom operators have long raised concerns about the unpaid debt, warning that the financial burden threatens the sustainability of USSD services.
“We are seeing payments from smaller players, but the big banks, which owe the most, have not been forthcoming,” said Gbenga Adebayo, Chairman of the Association of Licensed Telecom Operators of Nigeria. “We are now waiting for intervention from regulators, including the CBN and NCC, to resolve the issue.”
Between January and June 2024, over 252 million transactions worth ₦2.19 trillion were conducted via USSD platforms. This represents a sharp increase compared to the ₦4.84 trillion transacted in 630 million transactions in 2023.
Initially developed by telecom operators for airtime and subscription services, USSD has become a critical tool for the banking sector, enabling financial inclusion for millions of Nigerians.
However, as banks generate significant revenue through these services, telecom operators argue they must be adequately compensated for maintaining the infrastructure.
Smaller banks have begun making payments but tier-one lenders with the bulk of the debt are reluctant.
Ejike Onyeaso, a director at Adaba Consult, said “Telecom companies are upset with banks over inadequate payments for leased lines used for services like USSD. Since banks generate revenue through these services, they should compensate telecom firms.”
