The Nigerian Communications Commission (NCC) has issued a stern directive to telecommunications operators to cut off Unstructured Supplementary Service Data (USSD) codes linked to nine financial institutions, citing massive unpaid debts that date back as far as 2020.
In a notice signed by its Director of Public Affairs, Reuben Muoka, the commission warned that failure to settle these debts by January 27, 2025, could lead to severe service disruptions for millions of Nigerians relying on the USSD platform for banking transactions.
Debt Drama Unfolds
The NCC revealed that nine out of the 18 financial institutions involved in the USSD ecosystem had failed to comply with directives issued in a joint circular by the Central Bank of Nigeria (CBN) and the commission on December 20, 2024.
The public notice stated:
“Of a total of 18 financial institutions, the nine institutions listed below have failed to comply significantly with the directives in the Second Joint Circular of the Central Bank of Nigeria and the commission dated December 20, 2024, for the settlement of outstanding invoices due to Mobile Network Operators (MNOs), some since 2020.”
Among the listed banks are Fidelity Bank Plc, First City Monument Bank, Jaiz Bank Plc, Polaris Bank Limited, Sterling Bank Limited, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc, and Zenith Bank Plc.
While the NCC refrained from disclosing the specific amount owed by each bank, sources suggest the cumulative debt originally exceeded a staggering ₦200 billion.
Consumer Impact Looms
Should the affected banks fail to settle their debts, millions of Nigerians could be unable to access essential services like fund transfers and bill payments through popular USSD codes such as 770, 919, and 822.
The NCC underscored its commitment to consumer protection, stating, “In fulfilment of its consumer protection mandate, the commission wishes to inform consumers that they may be unable to access the USSD platform of the affected financial institutions from January 27, 2025.”
This development poses a significant inconvenience to customers who rely heavily on USSD for financial transactions, especially in areas with limited internet connectivity.
A Crisis in the Making?
The looming disconnection could signal a broader crisis in Nigeria’s financial sector, where USSD technology has become a cornerstone for financial inclusion. According to data from the CBN, an astounding 252.06 million transactions worth ₦2.19 trillion were conducted via USSD in the first half of 2024 alone.
Speaking to Channels Television, a telecoms expert, Chijioke Nwokoye, warned of dire consequences if the issue remains unresolved. “The disconnection of USSD codes will disrupt access to critical banking services, further eroding consumer trust in both the financial and telecoms sectors,” he said.
A History of Disputes
This is not the first time banks and telecom operators have clashed over USSD fees. In previous years, disputes arose over who should bear the cost of USSD services—banks or telecom providers. Although a temporary resolution was reached, unpaid invoices have continued to accumulate, deepening tensions between the two industries.
The NCC’s latest action highlights the regulator’s determination to enforce compliance, even at the expense of customer convenience.
Deadline for Compliance
With less than two weeks to the January 27 deadline, the clock is ticking for the defaulting banks. The NCC has made it clear that failure to resolve the matter could result in the reassignment of their USSD codes to other entities.
“The banks have been duly notified of the need for immediate compliance,” the commission stressed in its statement.
Reactions and Next Steps
Financial analysts have expressed concerns over the potential fallout from this directive. “This could have ripple effects on the financial system, particularly for rural communities where USSD is often the only banking channel available,” said Oluwatosin Ajayi, an economist based in Lagos.
Meanwhile, telecom operators appear resolute in their stance. “We’ve been patient for too long,” said an anonymous source within a leading telecom firm. “The debts are crippling our operations, and something had to be done.”
The banks involved have yet to issue a collective response, although sources suggest internal discussions are ongoing to address the matter before the deadline.
Implications for Nigerians
The disconnection of USSD services would disproportionately affect low-income earners and small business owners who rely on the service for day-to-day transactions.
“Without USSD, how do we send money or buy airtime?” lamented a Lagos-based trader, Bimpe Adewale. “This will only make life harder for ordinary Nigerians.”
As the deadline approaches, all eyes will be on the banks and the NCC to see if a resolution can be reached that prevents the looming disruption from becoming a reality.
A Call for Urgency
This situation serves as a stark reminder of the need for improved synergy between Nigeria’s financial and telecom sectors. Experts argue that resolving these systemic issues is crucial for ensuring uninterrupted access to financial services and fostering greater trust among consumers.
Whether the nine banks will rise to the occasion or face disconnection remains to be seen, but for millions of Nigerians, the stakes couldn’t be higher.