Telcos Seek NCC Approval To Disconnect Banks

Telecommunication operators have reached out to the Nigerian Communications Commission (NCC) for approval to phase out the Unstructured Supplementary Service Data (USSD) offered to banks due to over N80billion.

The Chairman, Association of Licensed Telecoms Operators of Nigeria, Gbenga Adebayo, said that the operators had sought regulatory approval to implement partial removal of the USSD services.

He noted that the disconnection would be done in batches, starting with the highest debtor immediately after they get approval.

He said, “We have sought regulatory approval to pursue partial removal. We would start disconnecting those who owe us in batches, a highest debtor scenario. We don’t know as regards the timing because we are required to get approval before acting. But we would certainly commence the process once it is approved. The amount is over N80bn, it is not yet up to N90bn, but it is up to that.”

Meanwhile, the Head of Operations, ALTON, Gbolahan Awonuga, said the debt had become huge, necessitating the need for regulatory approval.

Although he said he was not sure of the timeline for the removal, the gradual phase-out may occur around the first quarter of 2023.

He said, “The debt is a lot now. The banks are charging customers. We could have done it but because we are. It will get to a time before we do that. Before we can do that, we need to get regulatory approval. I cannot give you a timeline.

“This could happen around the first quarter. This would affect the CBN’s cashless policy. How many people use Internet banking? This is likely going to happen in the first quarter and is around the N80bn.”

Deposit Money Banks and telecom operators have been at odds since 2019 over non-remittance of USSD fees.

In 2019, telcos said they could no longer provide the services for free and proposed to take a cut of N4.50k per 20 seconds from the charges paid by customers to the banks.

However, the banks kicked against it, alleging that it would raise costs by 450 percent.

On March 12, 2021, telecom operators said they would suspend the USSD service over N42bn accumulated debt by banks — a move halted by the Minister of Communications and Digital Economy, Isa Pantami.

Pantami, had written to CBN Governor, Mr. Godwin Emefiele, highlighting the impending danger of the disagreement and stressing the need for banks to pay the accumulated debt or risk suspension of the USSD code.

The banks, telcos, CBN and the NCC have had several meetings in the past to resolve the issue.