USSD code of 9 banks set to be disconnected today over lingering N250bn debts

In line with the Nigerian Communications Commission’s (NCC) directives to mobile network operators such as MTN, Globacom, and Airtel on the N250bn USSD debt owned by banks, the dedicated text message services are set to stop at the close of today’s business unless the lenders settle their outstanding debts. 

The regulator earlier warned all nine banks who were yet to clear their debts to do so on or before January 27, 2025, or risk losing access to their USSD codes. While reports suggest that some banks have been complying with the directives, telecom operators said a few are yet to heed the directive.  

Speaking on Sunday with Punch, Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), Gbenga Adebayo explained that actions in line with the NCC directives will be taken against banks that fail to adhere. 

“A number of them are complying in line with the regulatory intervention made by the CBN and NCC. We still have a few hard debtors who haven’t complied, but when the time comes, according to the protocol of that circular, we are going to disconnect,” Adebayo said.

Also, President of the Association of Telecom Companies of Nigeria, Tony Emoekpere, while speaking on Monday noted that there were nine indebted banks, although he does not have the details now on how many of them have settled. He added that the Group would have to wait and get updates from mobile operators.

Regulators of both parties had previously made actions to settle the N250bn USSD debt that has been lingering for years. A joint statement issued by both NCC and Central Bank of Nigeria (CBN) in December directed commercial banks and telecom operators to resolve the dispute through a document outlining the payment procedures and operational guidelines to follow when clearing the debts. 

The agencies stressed that 85 per cent of USSD debts that accumulated after February 2022 in terms of their outstanding invoices must be paid by December 31, 2024. Commercial banks are to also ensure that 85 per cent of future invoices are settled within one month of issuance.

The document also mandated that 60 per cent of the debts incurred before the implementation of Application Programming Interfaces in February 2022 must be finalized by January 2, 2025, with full settlement due by July 2, 2025.

Unstructured Supplementary Service Data (USSD) is a vital service enabling customers to conduct banking transactions without Internet access. Originally developed by telecom operators for services such as airtime purchases and subscriptions, USSD has evolved into a vital financial tool, providing banking services to users without the need for an internet connection.

Similar Read: N250bn ussd debt: CBN, NCC issue final notice on telecom operators and banks dispute.

NCC’s deadline on N250bn USSD debt

Following the December 31 debt deadline clearance, the NCC authorized telecom operators to shut down the USSD codes of nine banks that are yet to pay their USSD debts.  

As of January 14, 2025, the commission noted that nine out of 18 financial institutions had not complied with regulatory directives. The nine defaulting banks include Fidelity Bank Plc with the 770 USSD code, First City Monument Bank (*329#), Jaiz Bank Plc (*773), and Polaris Bank Limited (*833#). Others are Sterling Bank Limited (*822#), United Bank for Africa Plc (*919#), Unity Bank Plc (*7799#), Wema Bank Plc (*945#), and Zenith Bank Plc (*966#).

The commission also warned the defaulting banks to settle their outstanding obligations by January 27, 2025, or risk losing access to their USSD codes.

Meanwhile, mobile operators experienced progress in repaying the N250 billion debt owed on Unstructured Supplementary Service Data (USSD) services rendered to commercial banks. While reporting in November, ALTON said that smaller banks started clearing their debts while tier-one lenders who take a larger share were yet to make a tangible mark. 

The association added that some repayments have been recorded but still fall below expectations which might force telecom operators to cut off USSD for banks if the debt is not resolved.

Over the past few months, mobile network operators (MNOs) have raised concerns over the effect of the unpaid N250bn USSD debts owed by banks. Telecom operators have since threatened to shut down USSD services due to incurring losses. The moves were halted following interventions by government authorities.

MTN Nigeria CEO, Karl Toriola said in October that the telecommunications sector has incurred huge losses that require significant intervention. He added that MTN, the largest telecommunications company in the country with about 78 million subscribers, recorded a loss of N519.1bn for the first half of 2024.

On another end, MNOs and commercial banks have had past disagreements concerning the appropriate USSD pricing model for financial transactions, transparency of charges, mode of collection, and liability for payment of the outstanding and continuous service fees.

A per session price of N6.98 (including settling any outstanding fees) was agreed upon between the banks and telcos after an intervention by the CBN and NCC in March 2021. However, the banks are alleged to have been deducting the N6.98 per session from their customers without remitting to MNOs.