Stakeholders Fret over Planned USSD Disconnection, Plead with Banks to Settle N120bn Indebtedness

Emma Okonji

Bank customers and other stakeholders in the financial sector are becoming worried over the implications of the planned disconnection of banks in Nigeria from the use of Unstructured Supplementary Service Data (USSD) platform, provided by telecoms operators.

Telecoms operators, last week, warned that they would not hesitate to disconnect bank customers anytime soon, should the banks fail to pay the accumulated N120 billion debt they owe telecoms operators for using the USSD platform for their financial transactions.

The USSD is a financial transaction platform that was developed by telecoms operators, which enables financial transactions on any mobile phone, using a short code.

A bank customer, Mr. Sylvester Odion, who spoke to THISDAY about the implications of the planned disconnection of USSD platform, said it would affect mostly low income earners who are bank customers as well as majority of traders and artisans who do not use mobile apps for their banking transactions because of the high cost of data.

According to him, this set of people prefer to use USSD platform to transfer and receive money because it works with feature phones that are far less expensive than smartphones and for the fact that financial transactions could be done with USSD code without data subscription.

He therefore called on banks to quickly reach an agreement with telecoms operators over the accumulated debt to avoid disconnection.

President, National Association of Telecoms Subscribers (NATCOMS), Chief Deolu Ogunbanjo, told THISDAY that the implications would have huge negative effect on the banking sector, because many bank customers that use the USSD platform will be completely disenfranchised, thereby putting pressure on mobile apps, which could lead to incessant failed financial transactions.

“If telecoms operators are allowed to make do their threat to disconnect bank customers from using the USSD platform, such action will cause a great setback for the financial sector and further widen the financial inclusion gap that banks are trying to bridge in collaboration with telecoms operators and Fintech players. Banks must therefore make haste to settle the accumulated debt owed telecom operators  to avoid disconnection,” Ogunbanjo said.      

He accused the banks of billing bank customers for using the USSD platform and wondered why banks have not been remitting money to telecoms operators for using their platform, when they are actually making money from USSD platform.

He further said Nigerians suffered a great deal of failed financial transactions in the first quarter of the year when the Nigerian currency was changed and old currency was withdrawn from circulation. He said Nigerians suffered from incessant failed financial transaction at that time because ATM machines were not dispensing cash and there was so much pressure on mobile apps for financial transactions, adding that such ugly scenario may play up again if USSD is disconnected.    

Giving details about the accumulated debt, the Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON), Mr. Gbenga Adebayo, told THISDAY that as at 2019 when the issue was first raised, the debt was N32 billion and in 2021, the debt was N42 billion, and rose to N80 billion in 2022, before rising to N120 billion in 2023.

He said the debt kept accumulating because the banks deliberately refused to pay, despite several reminders from the telecom body, the telecom regulator and the Minster of Communications and Digital Economy, Dr. Isa Ibrahim Pantami.

Adebayo further explained that the telecoms regulator, the Nigerian Communications Commission (NCC), gave telecoms operators the nod to disconnect banks, following their refusal to pay the accumulated debt.