USSD: Telcos vow to withdraw services over N42b bank indebtedness

Members of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) have vowed that effective Monday, they will withdraw their services to the public over alleged indebtedness of N42 billion to them by various financial institutions.

The warning by the group is contained in a letter addressed to the Minister of Communications and Digital Economy, Mallam Isa Patami wherein it lamented that the financial institutions have mounted debts amounting to N42b to them for the services rendered.

According to the association, the problem arose based on an arrangement that ensure that banks took on the responsibility of billing customers and subsequently pay its members for use of the USSD infrastructure from the service fees deducted from the customer’s bank account.

The arrangement is sequel to the issuance of the USSD Pricing determination by the Nigerian Communications Commission (NCC) which resulted in a price review of USSD service by members, which the banks decided that they would no longer pay when delivered to their customers.

Thus, the association added that the various banks then requested its members would now have to charge customers directly for use of the USSD channel.

The letter lamented that “​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.”

This not withstanding, it added  Mobile Network Operators (MNO’s) have continued to provide access to USSD infrastructure despite the fact that obligations due from banks to telecoms companies for USSD services has reached over N42b.

On its next move, the association wrote that “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.

“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.”

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