Nigeria Telecoms Threaten to Withdraw Support for Banks’ USSD Services Over Debt Dispute
Nigeria Telecoms Threaten to Withdraw Support for Banks’ USSD Services Over Debt Dispute
Nigeria’s telecom operators, including MTN Nigeria, Airtel, Globacom, and 9Mobile, have issued a warning that they may withdraw network support for banks’ Unstructured Supplementary Service Data (USSD) services. The threat comes amidst accusations of misinformation directed at subscribers regarding how transaction fees are deducted.
USSD, often referred to as ‘bank transfers,’ operates via short codes on mobile phones and is a popular method for banking transactions.
Yesterday, Nigerian banks notified customers that the Nigerian Communications Commission (NCC) had instructed them to cease deducting USSD transaction charges directly from customers’ bank accounts. Instead, these charges will now be deducted by telecom operators from users’ mobile airtime balances.
The banks’ notice stated: “In line with NCC directives, effective June 3, 2025, charges for USSD banking services will no longer be deducted from your bank account. Instead, these charges will be billed directly to your mobile airtime balance under the NCC’s End-User Billing (EUB) model. Each USSD session will incur a fee of ₦6.98 per 120 seconds, billed by your mobile network operator. You will see a prompt asking for your consent at the start of each session, and airtime will only be deducted if you confirm and if the bank is ready to process the service. If you prefer not to use USSD banking under this new arrangement, you may choose to discontinue its use.”
In response, the Association of Licensed Telecom Operators of Nigeria (ALTON), representing the telcos, criticized the banks’ notice, claiming it contains “gross misinformation” aimed at serving their own interests. ALTON threatened to withdraw network support for the banks’ USSD services.
ALTON Chairman Engr Gbenga Adebayo explained to journalists: “The banks are distorting facts and twisting agreements to favor their selfish motives. The directive wasn’t solely from the NCC but was part of a joint regulatory agreement between the NCC and the Central Bank of Nigeria (CBN), with the telcos and banks witnessing. The agreement states that if banks settle their USSD debts by June 2, 2025, they can transition to the end-user billing model, provided the migration process is transparent and agreed upon by all parties.”
He further clarified: “The reason for this clause was to prevent double billing—where a customer’s airtime is deducted while the bank also charges their account for the same service. Some banks have cleared their debts, but most have not. Even if all conditions for migration are met, implementation cannot proceed until the debts owed to telcos are fully settled.”
Adebayo emphasized that if banks insist on disregarding the agreement, telcos may withdraw support for their USSD services. “Support for USSD isn’t mandatory; they can do without it. But they must clear their outstanding debts first,” he concluded.
