Nigeria’s major telecommunications operators MTN Nigeria, Airtel, Globacom, and 9mobile have issued a stern warning that they may withdraw support for Unstructured Supplementary Service Data (USSD) services currently provided to banks.
The warning follows what telecom operators describe as deliberate misinformation being circulated by banks regarding the billing process for USSD transactions, which are widely used for mobile banking via short codes.
Banks Announce New USSD Charges: Airtime Deduction Begins
On Monday, several commercial banks began notifying their customers of a new billing structure supposedly mandated by the Nigerian Communications Commission (NCC). According to the messages sent to customers, banks would no longer deduct USSD fees directly from customers’ bank accounts. Instead, the charges would now be debited from users’ mobile airtime balances, with effect from June 3, 2025.
The banks stated that:
“In line with the directive of the Nigerian Communications Commission (NCC), charges for USSD banking services will now be deducted from your airtime balance.
Each session will attract a fee of ₦6.98 per 120 seconds, which will be billed by your mobile network provider.
You will receive a consent prompt at the start of each session, and airtime will only be deducted upon your confirmation.”
Customers were further told that they could opt out of USSD services if they were uncomfortable with the new billing model.
Telecom Operators Push Back: “This Is Not What We Agreed”
In a swift rebuttal, the Association of Licensed Telecom Operators of Nigeria (ALTON), which represents the telcos, accused banks of misrepresenting the facts to protect their own interests. According to ALTON, the new billing arrangement was not an independent directive from the NCC but rather the outcome of a joint regulatory agreement involving the NCC, the Central Bank of Nigeria (CBN), the banks, and the telecom operators.
“The banks are twisting the facts. There was no unilateral directive from the NCC,” said Engr. Gbenga Adebayo, ALTON Chairman, during an interview with Vanguard.
“What was agreed is that if the banks clear all their USSD debts to telcos by June 2, 2025, they may then proceed to adopt the end-user billing model, provided the migration process is transparent and agreed upon by all parties.”
Adebayo clarified that telcos insisted on certain safeguards particularly that customers should never be charged twice for the same service. This concern was at the heart of discussions around the transition to end-user billing.
Unsettled Debts Remain a Sticking Point
Despite partial repayments from a few banks, Adebayo noted that most banks have yet to clear their outstanding debts to telecom operators for USSD services previously rendered. As a result, he said, the migration to airtime billing should not even have commenced.
“Even if all the billing modalities were in place, implementation is premature because the debts remain unpaid.
If this misinformation continues, we may have no choice but to suspend USSD access to the banks,” Adebayo warned.
“USSD is not a mandatory service for telcos. We can withdraw it but the banks must fulfill their part of the agreement.”
Background: Longstanding Friction Over USSD Fees
The tension over USSD charges is not new. Telecom operators have for years decried the non-payment of USSD-related fees by banks, accumulating multi-billion naira debts. Banks, on the other hand, have resisted passing those charges to customers, often due to public backlash and regulatory uncertainty.
This latest conflict highlights the fragile collaboration between telecoms and financial institutions, even as Nigeria pushes further into digital financial inclusion. Millions of Nigerians rely on USSD for banking, especially in rural or low-internet areas.
What Happens Next?
If telecom operators follow through with their threat, mobile banking services via USSD could become inaccessible, severely affecting millions of users who depend on the service for transfers, bill payments, and balance inquiries.
It remains to be seen whether the NCC and CBN will intervene to broker peace — or whether banks will clear the debts and renegotiate terms before a total service disruption occurs.
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