The Federal Government is set to announce the blacklisting of 18 banks tomorrow over their refusal to settle a cumulative debt of nearly ₦200 billion owed to Nigerian telecom operators for Unstructured Supplementary Service Data (USSD) services.
Longstanding Dispute
The debt, which has remained unresolved for years, has led to strained relations between banks and telecom operators. The move to publicize the defaulting banks aims to empower telcos to suspend USSD services for these institutions, potentially disrupting their online banking operations.
CBN and NCC Intervention
In December 2024, the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) issued a final directive mandating Deposit Money Banks (DMBs) and Mobile Network Operators (MNOs) to resolve the ₦250 billion USSD debt impasse.
A joint circular, signed by CBN’s acting Director of Payments System Management, Oladimeji Taiwo, and NCC’s Head of Legal and Regulatory Services, Chizua Whyte, detailed a payment plan and new guidelines for USSD services.
Key Directives
- Pre-2022 Debt: Banks were required to pay 60% of debts incurred before February 2022 by January 2, 2025, with full settlement by July 2, 2025.
- Post-2022 Debt: For debts after February 2022, 85% of outstanding invoices must be paid by December 31, 2024, with future invoices settled within a month.
- Litigation Halt: Both parties were ordered to discontinue any ongoing legal actions related to the debt dispute.
- Sanctions for Non-Compliance: Banks and telcos failing to meet the outlined terms face severe penalties.
Telecom Operators’ Stance
Telecom operators, who have long demanded a clear payment framework, welcomed the measures but stressed the need for prompt compliance. They have threatened to suspend USSD services for defaulting banks, which could disrupt critical mobile banking services across Nigeria.
Transition to End-User Billing
The regulators also emphasized transitioning to an end-user billing system (EUB) for USSD services. Only banks and telcos adhering to the payment terms will be allowed to implement this model. Pending the transition, a “10-seconds rule” has been mandated, ensuring sessions shorter than 10 seconds are not billed.
Economic Implications
USSD services are vital for financial inclusion, particularly in rural areas where internet access is limited. Banks rely on USSD for mobile banking, airtime top-ups, bill payments, and other essential services.
While smaller banks have begun settling their debts in installments, major tier-one lenders—responsible for the bulk of the debt—have yet to make significant payments, according to Gbenga Adebayo, Chairman of the Association of Licensed Telecom Operators of Nigeria.
The Federal Government’s decisive action underscores the urgency of resolving this impasse to ensure financial and telecommunications sector stability while safeguarding the accessibility of USSD services for millions of Nigerians.