Federal government has failed to intervene in the unstructured supplementary service data (USSD) debt crisis between the telecom operators and the financial banks in the country.
Karl Toriola, chief executive officer (CEO), MTN Nigeria, said the banks might be disconnected from the USSD platform due to debt arising from the use of the quick codes by their customers, which has now reached N250 billion.
USSD, also known as quick or feature codes, is a global system for mobile communications (GSM) protocol that is used to send text messages and initiate financial transactions such as cash transfers, balance inquiries, payments for services and others.
As at Tuesday, Dr. Bosun Tijani, minister of Communications and Digital Economy, and the Nigerian Communications Commission (NCC) were taciturn.
But Toriola said mobile network operators (MNOs) might, subject to regulatory approval, suspend supporting the use of the service on the network for banking operations, as the debt had continued to pile up and was becoming unsustainable to the operators.
According to Toriola, the increasing debt is unsustainable for telecommunications companies (telcos).
Also speaking, Engr. Gbenga Adebayo, chairman, Association of Licensed Telecom Operators of Nigeria (ALTON), described the services provided by telecommunication firms for banks’ customers to use USSD as commercial and not for social purpose
“The debt has been long overdue and the banks who owe the telcos have more or less turned us to beggars on getting them to pay our debt, so there is no choice.
“If the regulators do not resolve the matter, what has been foreseen will happen, the services will be withdrawn. We are leaving to the CBN to resolve, if it is not able to resolve this matter, there will be no choice than to withdraw USSD from the banks,” he added.
Deolu Ogunbanjo, a telecom right activist, said Nigerian telecoms’ subscribers should sue the banks if they couldn’t use the USSD for their banking transactions by May ending, according to Daily Trust.
Ogunbanjo, who is the president of the National Association of Telecom Subscribers of Nigeria (NATCOMS), said the telcos wouldn’t be doing anything wrong if they eventually disconnect the banks.
Recall that in 2019, telcos sought to charge banks N4.50 for every 20 seconds of USSD usage, but banks opposed this, claiming it would drastically hike transaction costs.
In response to mounting pressures, the operators previously agreed to a new charge of N6.98 per transaction in 2021.
Despite this, the debt has escalated significantly, with Toriola urging the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) to mediate for a resolution.
He emphasized that if the situation remains unresolved, telcos may have no choice but to seek regulatory approval to cut off banks from USSD services entirely.
Toriola lamented that the telecom sector is in critical condition, likening it to being in the “intensive care unit.”
He warned of dire consequences if the government does not allow necessary tariff adjustments, stating, “If the tariff doesn’t go up, we’ll shut down.”
