Telcos kick as banks plan USSD fee deduction from end users

 Against claims by Deposit Money Bank (DMBs) that starting from June 3, USSD charges will now be deducted directly from customers’ airtime instead of their bank accounts, telecom operators have however, faulted the claim, saying that will not be possible until agreements are met.

Telecom operators claimed that there has not been any formal communication agreeing to that either from them or the Nigerian Communications Commission (NCC).

As early as Monday, some DMBs have mailed their customers to inform them about the new developments surrounding the operations of USSD in the country.

USSD, otherwise Unstructured Supplementary Service Data, is a communications protocol used by GSM cellular telephones to interact with a mobile network operator’s computer.

The Guardian had exclusively reported on April 16 about the possibilities of telecom subscribers paying for the use of USSD with deductions from their airtime, which is the end-user billing system. This was supposed to help resolve the debt impasse, which was put at N160 billion as of November, even though some operators were reported to have made some substantial payments earlier this year.

First City Monument Bank (FCMB) announced this change in an e-mail message to customers, following a directive from the Nigerian Communications Commission (NCC).

The message reads: “Each USSD session will cost N6.98 per 120 seconds, charged by your mobile network. You will be asked to approve the charge before it’s deducted from your airtime. If you prefer, you can use other banking channels like ATMs, mobile apps, or Internet banking.”

Also, yesterday, StanbicIBTC mailed its customers on the new development. The bank said: “In line with the directive of the Nigerian Communications Commission (NCC), please be informed that effective Tuesday, June 3, 2025, charges for USSD banking services will no longer be deducted from your bank account.

“Going forward, these charges will be deducted directly from your mobile airtime balance in accordance with the NCC’s End-User Billing (EUB) model.

“Under this new billing structure, each USSD session will attract a charge of N6.98 per 120 seconds, which will be billed by your mobile network operator. You will receive a consent prompt at the start of each session, and airtime will only be deducted upon your confirmation and availability of the bank to fulfil this service.

“If you do not wish to continue using USSD banking under this new model, you may choose to discontinue use of the USSD channel. Alternative digital banking options, such as our Mobile App, ATMs and Internet Banking platform, remain available for your convenience.”

But speaking to The Guardian yesterday, the Chairman of the Association of Licensed Telecom Operators of Nigeria (ALTON), Gbenga Adebayo, said when the disagreement on USSD debt lingered, part of the resolution made with the regulator by way of intervention is that all banks, which owe the operators should pay based on the old regime.

Adebayo said that when they pay, telcos can migrate them to the end-user billing after they have fulfilled their debt obligations with the operators “and then the industry sets June 2, 2025, for migration, subject to parties being able to agree on the modalities, including that the banks cleared their obligations as and when due and secondly that parties can agree on the protocols for the migration, meaning that how do we ensure that customers are properly billed, that there is no double billing, no billing for an incomplete session and that we don’t bill on airtime, while banks again charge the customers’ account.

“We are supposed to agree on this and sign a Service Level Agreement on how those will be transparently done, as we speak today (yesterday), we have not concluded on that. So, we are surprised that the banks have gone ahead with the announcement that they are going to migrate. We are also surprised about the announcement reading that NCC and telcos have now agreed to start end-user billing, that is not correct!”

Adebayo, an engineer, said the position of telcos is that any bank that has fulfilled its obligations to the telcos by way of paying historical debts and is willing to go end-user billing, “We are ready to go.”

The ALTON boss was categorical that any bank that has yet to fulfil its obligations to the telcos under the regulatory intervention will not be allowed to charge users.

“If the banks are going to forcefully do it, we are ready to withdraw the USSD service from them; we don’t want any issues. So, we shall seek appropriate regulatory approval to disconnect from any banks forcefully taking customers to end-user billing without agreeing on service protocol, without agreeing on SLA with all of us, we are not going to be part of it. As we speak, we have not agreed on all of the charging mechanisms for the billings.