Telecommunications operators in Nigeria have announced their plans to disconnect banks from their services due to a staggering N120 billion debt in Unstructured Supplementary Service Data (USSD) fees. The move comes following approval from the Nigerian Communications Commission (NCC), despite previous attempts to resolve the dispute.
Mobile network operators, including MTN Nigeria, Airtel Nigeria, and Globacom, had initially sought to disconnect the banks in 2021 over the mounting USSD debt. However, the intervention of the Minister of Communication and Digital Economy, Isa Pantami, and the Central Bank of Nigeria (CBN) prevented the disconnection and facilitated the resolution of the dispute.
Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), Gbenga Adebayo, revealed the latest development during a press briefing in Lagos on Friday. He emphasized that unless the banks settle their outstanding debts, the mobile network operators will proceed with the disconnection.
Adebayo recalled the prolonged disagreements between the mobile network operators and banks over the appropriate pricing model for USSD financial transactions, transparency of charges, collection methods, and liability for payment of outstanding fees. Despite efforts by stakeholders to find a resolution and prevent any disruption of services, the NCC granted approval for the disconnection.
“The contract between MNOs and banks on the use of USSDs for banking transactions was strictly commercial,” stated Adebayo. “MNOs were at liberty to withdraw the services if the transactions proved unprofitable. However, the banks have failed to sign a final agreement, taking for granted the patriotic intervention of the minister and the NCC.”
He further explained that the MNOs had invested substantial funds in expanding their systems to accommodate the USSD needs of banks, resulting in increased access to banking services for Nigerians and reduced costs for banks. However, the debt owed by the banks has skyrocketed from N42 billion in 2021 to over N120 billion.
The ALTON chairman stressed that the current level of debt is unsustainable given the significant investments made by the MNOs in system upgrades and infrastructure to support USSD transactions. Consequently, unless the banks fulfill their financial obligations, the MNOs are prepared to disconnect any banks indebted to them for USSD services rendered.
