Nigeria’s telecom sector is facing a significant challenge as operators, including major players like MTN and Airtel, demand the settlement of a substantial Unstructured Supplementary Service Data (USSD) debt by Nigerian banks. The debt, initially estimated at N120 billion, has alarmingly escalated to N200 billion. This situation, as reported by industry experts, is severely impeding the progress of the telecom sector.
The Association of Licensed Telecommunications Operators of Nigeria (ALTON) is taking a firm stand, urging banks to promptly address this escalating debt to avoid a potential service shutdown. This ultimatum was voiced during a recent Nigerian Communications Commission industry interactive session with its new Executive Vice Chairman/Chief Executive Officer, Dr. Aminu Maida.
The debt, which has been accumulating since 2019, stood at a mere N17 billion in 2020 but has since surged due to various factors, including the forex challenge. Gbenga Adebayo, the Chairman of ALTON, expressed concern over the banks’ silence on this matter. He emphasized the urgency of resolving this issue to prevent service disruptions that would affect bank customers’ ability to carry out USSD-based transactions, such as fund transfers, balance checks, and other mobile banking operations.
The deadlock between the telecom sector and the banks over USSD debt repayment dates back to 2019, with no significant progress made in negotiations. The rising debt figure has drawn criticism from various quarters, including the banking sector’s chief information officers, who have acknowledged the need for a swift resolution.
Furthermore, the discussion extends to the broader implications for financial inclusion in Nigeria. Segun Agbaje, the CEO of Guaranty Trust Holding Company Plc, has suggested that reducing data costs is essential for achieving financial inclusion, describing USSD as a “clumsy technology.”
Amidst these challenges, the Nigerian Communications Commission (NCC) reassures telecom consumers that there are no immediate plans for a tariff hike, despite ongoing discussions about eliminating fuel subsidies. The NCC’s commitment to improving customer experiences and relations remains a priority, as indicated by the recent rollout of new guidelines for telecom companies in the country.
This situation highlights the need for collaborative efforts between the telecom and banking sectors to find a sustainable solution, ensuring uninterrupted service for millions of Nigerians who rely on USSD for their daily financial transactions.