Again, telcos threaten to withdraw USSD service as debt mounts to N200 billion

Telecom operators under the aegis of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) have again threatened to withdraw the Unstructured Supplementary Service Data (USSD) from Deposit Money Banks (DMBs) as debt owed to the telcos over the service hits N200bn.

The USSD is a service provided by telecommunication companies to banks that allows bank users to transact financial businesses like cash transfer, checking of balance and buying of airtime directly from their bank accounts.

The fracas between the telcos and DMBs will be entering its fifth year by 2024 without any headway in sight for a major truce.

Trouble started in 2019 when telcos said they could no longer provide the services for free and proposed to take a cut of N4.50k per 20 seconds from the charges paid by customers to the banks. However, the banks kicked against it, alleging that it would raise costs by 450 percent.

On March 12, 2021, telecom operators said they would suspend the USSD service over N42 billion accumulated debt by banks — a move halted by Isa Pantami, former minister of communications and digital economy.

Mobile network operators (MNOs) and deposit money banks (DMBs) eventually agreed on March 16, 2021, to transfer the charge of N6.98k to customers for each USSD transaction, this has been in place since then.

READ ALSO:MTN, Airtel, others threaten to shutdown banks’ USSD services over N80bn debt

However, banks have failed to remit the deductions to the telcos, a move that has seen the debt increase rise to about N200b now.

Reacting to this, ALTON Chairman, Gbenga Adebayo at the first telecoms stakeholders’ meeting with the Executive Vice Chairman of Nigerian Communications Commission (NCC), Dr. Aminu Maida in Lagos on Thursday disclosed that the association will withdraw the service from banks unless the debt is paid.

Adebayo said despite all appeals, meetings and interventions by the Ministry of Communications, Innovation and Digital Economy, Central Bank of Nigeria (CBN), and NCC, largely during the last administration, the banks have kept mute overpayment.

The ALTON boss said the value of the debt would keep rising based on the fluctuating challenges confronting foreign exchange stability in the country.

Adebayo, who said the matter needed to be resolved as fast as possible to avoid the collapse of the sector, noted that the debt is not allowing the operators to further expand services.

“Of course, we can confirm that there had been talks, largely before now, but no progress has been made. The matter needs to be resolved as fast as possible to avoid service shut down,” he stated.

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