Nigerian banks have announced an increase in SMS transaction alert fees, effective May 1, 2025, in response to a 50% telecom tariff hike approved by the Nigerian Communications Commission (NCC) in January 2025.
The adjustment, which raises SMS charges from ₦4 to ₦6 per message, reflects the rising operational costs faced by telecommunications operators, prompting banks to pass on the additional costs to customers.
This development has sparked concerns among consumers grappling with economic challenges, including high inflation and naira devaluation.
The NCC’s decision to approve the tariff increase, the first in over a decade, was announced on January 20, 2025, following years of lobbying by major telecom operators such as MTN Nigeria, Airtel, Glo, and 9mobile. The operators cited escalating operational costs driven by inflation, foreign exchange volatility, and soaring energy prices as justification for the hike.
The NCC capped the increase at 50%, rejecting the 100% hike requested by some operators, to balance industry sustainability with consumer affordability. The new tariff regime, implemented on February 11, 2025, has led to higher costs for voice calls, SMS, and data bundles across all mobile networks.
For instance, SMS charges have risen from ₦4 to ₦6, voice calls from ₦11 to ₦16.25 per minute, and a 1GB data bundle from ₦1,000 to at least ₦1,400.
Banks set May 1 for SMS transaction alert fee increase
Nigerian banks, reliant on telecom services for sending transaction alerts, have swiftly adjusted their SMS fees to reflect the new rates. Guaranty Trust Bank (GTB) was among the first to notify customers, stating, “Effective Thursday, May 1, 2025, the SMS transaction alert fee will increase from ₦4 to ₦6 per message due to a recent increase in telecom rates as communicated by the telecommunication service providers.”
Similar announcements have been made by other banks, with posts on X indicating widespread adoption of the new fee structure across the banking sector.
This move has drawn mixed reactions, with some customers expressing frustration over the additional financial burden, while others acknowledge the necessity of the adjustment given the telecom industry’s challenges.
The telecom tariff hike comes at a time when Nigeria’s economy is under strain, with inflation reaching 34.8% in 2025, up from 8.5% in 2013, when tariffs were last adjusted. The naira’s devaluation has further compounded the situation, increasing the cost of importing critical infrastructure like base stations, which now cost nearly four times more than two years ago.
Diesel prices, essential for powering base stations, have also surged from ₦230 per litre pre-COVID to over ₦1,000 in 2024, adding to operators’ financial woes.
MTN Nigeria reported a staggering ₦514.9 billion loss in the first nine months of 2024, while Airtel Africa recorded a $89 million loss in the 2024 fiscal year, largely due to challenges in Nigeria.
The NCC has emphasised that the tariff increase is aimed at ensuring the telecom sector’s sustainability while improving service quality. The regulator has mandated operators to enhance network coverage, reduce dropped calls, and provide clearer billing templates to address consumer complaints about confusing charges.
“The NCC recognises the financial pressures faced by Nigerian households and remains empathetic to the impact of tariff adjustments,” the commission stated in a January 2025 release. It has given operators a three-month timeline to demonstrate measurable improvements in service delivery, with stricter penalties for non-compliance.
However, consumer groups have voiced concerns about the affordability of the new rates, particularly for low-income Nigerians. Deolu Ogunbanjo, president of the National Association of Telecoms Subscribers (NATCOMS), criticised the 50% hike as excessive, recommending a 5% to 10% increase instead.
“This will affect everyone, from the biggest industries to the smallest businesses, like Point of Service (POS) operators,” Ogunbanjo said, highlighting the ripple effect on operational costs across sectors.
The banking sector’s decision to raise SMS charges has further amplified these concerns. With millions of Nigerians relying on SMS alerts for real-time transaction updates, the fee increase could strain household budgets, especially for small-scale entrepreneurs and low-income earners.
Posts on X reflect growing public discontent, with users accusing telecom operators of exploiting the tariff hike to maximise profits. One user, @afrisagacity, lamented, “Data charges have been hiked by 50%, yet these telecoms reset their data to drain at high speed! Even worse, the network is extremely poor.”
Despite the backlash, industry stakeholders argue that the tariff adjustment is critical for sustaining Nigeria’s telecom sector, which contributes significantly to the country’s GDP. Tony Izuagbe Emoekpere, president of the Association of Telecommunications Companies of Nigeria (ATCON), noted that the additional revenue would be reinvested to enhance network quality and expand coverage.
The GSMA, in a January 2025 statement, projected that the tariff increase could unlock over $150 million in mobile network investment, expanding 4G coverage to 94% of the population and connecting an additional 9 million people, including 2 million in underserved areas.
As Nigerians brace for higher telecom and banking service costs, the focus remains on whether the promised improvements in service quality will materialise. The NCC and telecom operators face mounting pressure to deliver on their commitments, while consumers hope for a balance between affordability and reliable connectivity in an increasingly digital economy.
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