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Nigerian telcos take on banks over USSD service fees

Nigeria , 16 Mar 2021

An eleventh-hour intervention by Nigeria’s Minister of Communications and Digital Economy Dr Isa Pantami has temporarily halted the scheduled suspension of USSD services.

Telecommunication services providers want to initiate a phased withdrawal of USSD services to banks over alleged unpaid debts of over NGN42-billion (approximately US$110-million).

Widely considered to be the backbone of Nigeria’s expanding Fintech ecosystem, USSD services are used by millions to access digital banking services.

Last year the Nigerian Communications Commission (NCC) barred telcos from billing end users directly for accessing banking services via USSD. Instead, the regulator ordered banks to negotiate with their customers regarding the settlement of outstanding fees.

Now stakeholders are at loggerheads over whether it should be consumers or MNOs that foot the bill.

According to Association of Telecoms Operators of Nigeria (ALTON), banks have opted to no longer pay for the USSD service and have requested that operators bill customers directly.

In a statement, the operators, via ALTON, said they are determined to withdraw USSD services and have advised subscribers to use alternative means to access banking services.

The organisation added that operators have no assurance that service charges levied on customers' bank accounts for accessing banking services through the USSD channel will be waived after the implementation of user billing.

“We deeply regret that we have reached a point where the withdrawal of these services has become inevitable,” ALTON stated.

On 15 March 2021 ITWeb Africa confirmed that USSD services of major banks in Nigeria, including FirstBank and Guaranty Trust Bank, were still accessible.

In a statement issued by the communications ministry, Pantami called for a meeting of the stakeholders, including the Governor of the Central Bank of Nigeria, NCC’s Executive Vice Chairman, MNOs and financial institutions.

Pantami appealed to telcos to await the outcome of the meeting.

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