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Nigerian Telcos To Discontinue Banks’ Use of USSD Over N42 Billion Debt



Nigerian Telcos To Discontinue Banks’ Use of USSD Over N42bn Debt, SiliconNigeria

Nigerian mobile network operators are set to discontinue from Monday March 15, 2021, the use of Unstructured Supplementary Service Data (USSD) short code service by some Financial Service Providers (FSPs) over N42 billion debt owed them in the past eight months.

 The Telcos under the aegis of Association of Licenced Telecommunications Operators of Nigeria (ALTON) which comprises Network Operators, Infrastructure Companies and Value Added Services Providers, said since the USSD Pricing determination by the Nigerian Communications Commission (NCC) which resulted in a price review of USSD service by its members, banks are yet to pay them accumulated USSD transactions costs.  

Nigerian Telcos To Discontinue Banks’ Use of USSD Over N42bn Debt, SiliconNigeria

According to ALTON, the NCC’s updated pricing methodology for USSD services for financial transactions in Nigeria. explicitly restricts Mobile Network Operators (MNO’s) from charging the end user for the services and mandates the banking sector to enter into negotiations to settle outstanding obligations and agree individual pricing mechanisms to be applied going forwards.

A statement jointly signed by Engr. Gbenga Adebayo, Chairman and Gbolahan Awonuga, Head of Operations of ALTON respectively states that:

“ALTON is aware of the letter issued by the Minister of Communications and Digital Economy to the Central Bank of Nigeria, seeking a resolution to the on-going dispute between the banking sector (Financial Service Providers (FSPs)) and the telecoms sector over the appropriate methodology to use to charge for USSD services.

“The background to this problem was that in order to accelerate the adoption of financial services on USSD, the Financial Service Providers (FSPs) partnered with our members to zero-rate the USSD access to end-users, while they bore the cost for the provision of service.  Based on this arrangement, the banks took on the responsibility of billing customers and paid our members for use of the USSD infrastructure from the service fees deducted from the customer’s bank account.

“Following the issuance of the USSD Pricing determination by the Nigerian Communications Commission (NCC) which resulted in a price review of USSD service by our members, the banks decided that they would no longer pay for USSD service delivered to their customers and requested our members to charge customers directly for use of the USSD channel.

“This billing methodology where the Financial Service Providers (FSPs) customer is directly charged USSD access fees by our members irrespective of the service charges that the bank may subsequently apply to the customers’ bank account is called “End-User Billing” which the banks specifically demanded that all our members implement. The banks, however, provided no assurances to our members that such service fees charged to customers’ bank accounts for access to bank services through the USSD channel would be discontinued post implementation of end-user billing by our members.

“The removal of these service fees by the Financial Service Providers (FSPs) would have meant that if bank customers were charged only the USSD costs communicated by our members per USSD session, bank customers will be paying far less than what they are currently being charged by the Financial Service Providers (FSPs) which in some instances are as high as N50.  Additionally the banks and telcos will be applauded for collaborating towards the financial inclusion objectives of the Federal Government.

 “It has been more than eight (8) months since the Nigerian Communications Commission (NCC) issued an updated pricing methodology for USSD services for financial transactions in Nigeria. The methodology explicitly restricts Mobile Network Operators (MNO’s) from charging the end user for the services and mandates the banking sector to enter into negotiations to settle outstanding obligations and agree individual pricing mechanisms to be applied going forwards.

“During this time, Mobile Network Operators (MNO’s) have continued to provide access to USSD infrastructure and our members have continued to pay all Bank charges and fees to access the Banking industries assets and customers, despite the fact that obligations due from banks to telecoms companies for USSD services has reached over Forty-Two Billion (N42B) Naira.

“ALTON members have continued to provide these services because our primary concern is that the millions of Nigerian customers who access financial services through our USSD infrastructure every day should be able to continue conducting their transactions. This was given greater importance when customers’ became further reliant on these services due to COVID movement restrictions. Unfortunately, as it has been impossible to agree on a structure for these payments with the banks that do not involve the end-user being asked to pay, the government has been forced to intervene to ensure that a sustainable cost-sharing solution is agreed, that does not disadvantage the consumer in the long-term.

“We deeply regret that we have reached a point where the withdrawal of these services has become unavoidable, however, we remain committed to working closely with the relevant Ministries and regulators to resolve this issue as quickly as possible. To minimise the disruption to customers, and with the concurrence of the Honourable Minster of Communications and Digital Economy and the Nigerian Communications Commission, on the huge debt to the Network operators; Mobile Network Operators will disconnect debtorFinancial Service Providers (FSPs) from USSD services, until the huge debt is paid.

“Therefore, our members are initiating a phased process of withdrawal of USSD services, starting with the most significant debtors within the Financial Service Providers (FSPs) effective Monday March 15, 2021. While the withdrawal of USSD service is in place, we encourage our subscribers to kindly explore alternative channels with their Banks,” ALTON statement concluded.

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Mobile Business

IHS Towers Acquires 819 Mobile Towers in Latin America



IHS Towers Acquires 819 Mobile Towers in Latin America, SiliconNigeria

Telecoms infrastructure provider IHS Towers added 819 towers to its Latin America portfolio, as it looks to boost its market presence in what it claimed was a key region offering significant growth potential.

In a statement, the company explained the deal includes the acquisition of 602 towers in Brazil and 217 in Colombia from tower operator Centennial Towers, bringing its total portfolio to more than 29,700 towers spanning nine markets.

Following the deal, Centennial Towers only has operations in Mexico, consisting of approximately 800 towers.

IHS Towers said the move was aligned with its growth strategy, reinforcing its position and “core expertise” in both countries.

The tower operator added the takeover would place it in a good position to support 5G rollouts in Brazil and Colombia by providing new locations for signal transmission and distribution, alongside fibre deployment support.

IHS Towers chairman and group CEO Sam Darwish highlighted Latin America as a “key region for us with its high growth potential” and said the company will continue increasing its market presence in the territory.

The provider entered Latin America in February 2020 by purchasing nearly 2,300 towers in Brazil from Cell Site Solutions.

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Nigerian Banks Lift USSD Restriction As MTN Reverts Back To 4.5% Commission



Nigerian Banks Lift USSD Restriction As MTN Reverts Back To 4.5% Commission, SiliconNigeria
  • Extends Partnership with Fintechs

MTN Nigeria, commercial banks and aggregators have agreed to revert back to the old commission formula for airtime vending on unstructured supplementary service data (USSD) and banking app channels.

The three parties have reverted back to the old 4.5 per cent commission charged for airtime vending through USSD and other banking channels. They reached for each other jugular over an impromptu reduction in the commission rate from 4.5 per cent to 2.5 per cent which too k effect on Thursday April 1, 2021.

At virtual meeting held yesterday by the chief executive officer of MTN Nigeria, Mr. Karl Toriola; the group CEO of Access Bank Plc, Mr. Herbert Wigwe who is also the chairman of the Body of Bank CEOs in Nigeria; Group CEO of Guaranty Trust Bank Plc, Mr. Segun Agbaje as well as MTN Nigeria’s chief financial officer, Modupe Kadri, they agreed to revert back to status quo ante of 4.5 per cent commission on USSD airtime.

MTN CEO, Toriola and addressed to Wigwe which was a follow-up on the virtual stated that, “In an attempt to resolve the current USSD impasse, given the intervention of our regulators, we hereby agree that the banks revert back to the status quo of 4.5 per cent commission.

“However, the banks and MTN Nigeria Plc shall sit to agree on various options that will result in the costs on 6th of April 2021.” The letter was copied to the Executive Vice Chairman/CEO of the NCC.

Elaborating further, he said in another statement that “the document was issued by me to the banks on the specific intervention of the CBN Governor and the Minister for Communications and Digital Economy. MTN’s intention has always been geared towards business optimization to the benefit of our customers and indeed the country.

“This is evidenced by the fact that through the USSD imbroglio, we never denied access to our customers. In the current case, customers have been denied access to services by the banks despite having monies in their accounts to purchase those services. MTN will naturally do all it can to minimise customer pain. It is not just about revenue for us.

“The good of our customers influence every decision we take. The CBN Governor’s intervention is in line with our core values. We acceded to his request and that of our Minister. We will continue to live our values that ‘everyone deserves the benefits of a modern connected life,” he concluded.

Meanwhile, the operator with over 70 million subscribers said it will continue to engage Fintechs to vend airtime. According to Funso Aina, Snr. Manager, External Relations, MTN, the links to access the various alternative platforms include:

1. MTN On Demand is on *904# and also via;

2. Barter By Flutter Wave is an app that can be downloaded here:;

3. Jumia Pay (app);

4. OPay (app);

5. MTN Xtratime airtime loans (*606#);

6. Carbon (app);

7. Kuda (app);

8. BillsnPay (web They also have an app);

9. myMTN Web;

10. Momo agent *223#

  The Apps can be downloaded from the Playstore and the Appstore.

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IT in Banking

Nigerian Banks Restrict USSD Transaction On MTN Over Commission



Nigerian Banks Restrict USSD Transaction On MTN Over Commission, SiliconNigeria

Nigerian banks have restricted transactions on USSD channels with Nigeria’s biggest mobile network operator, MTN Nigeria over a dispute on vending commission rate.

This restriction which took effect on April 1, 2021 was a result of the reduction of commission accruable to telecommunication Value Added Services (VAS) Aggregators and banks from 3.5 per cent to 2.5 per cent.

The aggregators alleged that had on March 31 informed them about the reduction in the commission earned by them which took effect the following day. Both the aggregators and the banks were uncomfortable with the new rate and the banks decided to restrict USSD channel transactions with MTN Nigeria to show their annoyance.

This new dimension is a dent on the recent resolution by both the telecommunications and banking industry regulators, the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) to resolve the USSD dispute which has lingered since 2019.

One of the aggregators alleged that MTN was bent on playing a dominant role in the digital financial services subsector in Nigeria and would do anything to limit the influence of the banks.   

Reaction to the development, a telecom industry source who pleaded anonymity as he was not authorised to speak on the matter informed SiliconNigeria that “The overnight suspension of airtime sales by some of the banks was not restricted to USSD channels alone, but includes airtime purchases through all banking channels – bank apps, bank USSD codes, even debit cards.”

Another source, said “The current dispute by the banks and the telecom industry is as a result of the debt of N42 billion owed telecom operators by banks. They want to surreptitiously factor it into a new price regime so that customers will unknowingly help them pay what they had already billed them. Of course, we refused, which is why they are fighting us now. USSD has not been cut by MTN.”

According to him, banks did not send a formal communication to customers or to MTN before taking this action. With their action, the banks are denying customers from accessing their money to make legitimate purchases/transactions. The banks are willing to cut off services to customers in order to protect profits.”

In the last four years, the banks have made:

Bank Turnover     Bank/ Earnings: 

2017  – N148b/N8b        5.5%;

2018  – N240b/N13b      5.5%;

2019  – N320b/N14b      4.5%;

2020 –         N470b/N18b        4%;

2021 – Projected  N652b/N20b        4% Q1 & 2.5% YE.

The NCC had in 2018 carried out the licensing of Value Added Services (VAS) Aggregators in the bid to improve the service delivery framework and improve consumer satisfaction on value-added services. The framework was to ensure that telecom subscribers truly get added value when they sign up for such services, and that all stakeholders along the value chain are treated equitably so that the industry can grow.

The Commission had licenced about 233 registered operators in the VAS segment of the telecoms industry. It allocated Short Codes to the 233 VAS licencees for the provision of different VAS services which has immensely enhanced service delivery in the Nigerian telecom and financial services industries. 

For instances, you can now recharge your mobile phone line, pay utility bills, make mobile Payments through VAS platforms. VAS has thus made life simple, contributed to the promotion of the financial inclusion policy of the government and facilitated the creation of wealth for many Nigerians. 

According to the Executive commissioner, technical services, NCC, Engr. Ubale Maska, ““Anything outside your telephone call or text message we consider it as VAS. It is good for the industry because it has brought a lot of convenience.For instance, you can sit down and transfer money to any account with short codes without going to the bank to queue.”

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