N80bn Debt: Telcos Threaten To Disconnect Banks USSD Subscribers
The Association of Licensed Telecommunications Operators of Nigeria (ALTON) says the accumulated debt from the unstructured supplementary service data (USSD), owed to them by banks, rose to N80 billion as of November this year.
ALTON said a time would soon come when telecommunication companies would be forced to withdraw from USSD services as banks refused to pay.
The Chairman, of ATCON, Mr Gbenga Adebayo, made this known in a recent interview with Thisday.
USSD is a critical channel for delivering financial services, particularly for the underserved and the financially excluded, offered by telecom operators to banks.
Banks use different USSD codes to support the transfer of money through the use of mobile devices, without internet data connectivity.
Mr Gbenga Adebayo said, “The debt is rising and has not been paid by the banks. As of November 2022, the accumulated debt rose to over N80 billion.
“When we started the argument in 2019, it was N32 billion, and they continue to claim that they are not owing, but our investigation shows that they are still using the USSD platform to offer banking services to their customers, yet they are not remitting to telecom operators who own the USSD platform.”
He said the issue has to be addressed as it cannot be wished away.
“Time will soon come when we will be constrained to withdraw the service and many bank customers that depend on the USSD service will suffer for it and it will affect the economy. It is honourable to pay their debts and they have to pay,” Adebayo said.
“We are warning that the banks’ action in refusing to pay their debt, will have negative consequences on the CBN’s cashless economy agenda for the country.
“It will be a threat to the cashless economy. So, CBN should advise money deposit banks to pay up the accumulated debts.”
Deposit Money Banks (DMO) and telecom operators have been at odds since 2019 over the non-remittance of USSD fees.
In 2019, 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 per cent.
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, minister of communications and digital economy.
In a meeting headed by the minister on March 16, 2021, mobile network operators (MNOs) and deposit money banks (DMBs) agreed to reduce the charge on customers to N6.98 for each USSD transaction.