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NCC : Banks owe telcos N17bn USSD charges

…seeks ministerial intervention for settlement

Commercial banks in the country are presently owing telecommunications operators a total of N17 billion for the use of Unstructured Sup-plementary Service Data (USSD), the Nigerian Communications Commission (NCC) has said. The Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta, who disclosed this yesterday during a virtual conference organised by the Association of Telecommunications Companies of Nigeria (ATCON), said the debt accumulated since the suspension of corporate billing last year.

“As we speak, commercial banks in the country are owing telecommunications companies over N17 billion and efforts are being made to ensure that the debt is paid,” Danbatta said. Unstructured Supplementary Service Data (USSD), sometimes referred to as “Quick Codes,” is a communications protocol used by GSM cellular telephones to communicate with the mobile network operator’s computers. Through corporate synergy, commercial banks are riding on the telecommunications infrastructure to deliver financial services to their customers via USSD. Disagreements, however, erupted last year October when the banks asked the telcos to stop the existing corporate billing system and demanded for end-user billing, which means the costs hitherto borne by the financial institutions would be passed to the customers.

An announcement of the end-user billing by the telcos had sparked outrage from Nigerians, which led to its suspension. While speaking at the virtual forum themed: “Meeting the Interests of Government, Consumers and Telecoms Companies in the Era of COVID-19 and Post-COVID-19 Pandemic for Digital Economy Development,” Danbatta noted that the Minister of Communications and Digital Economy, Dr. Isa Pantami, had already been briefed on the development with a view to ensuring a quick settlement of the debt. Recall that NCC had, earlier this week, announced an amendment to its USSD Pricing Determination, noting that it was necessitated by a protracted dispute between mobile network operators and financial institutions on the applicable charges for USSD services and the method of billing.

“As a responsive and effective regulatory authority, the Commission recognises that its policies are not static and may be modified from time to time as circumstances demand,” the Commission had stated. In the amended ‘Determination of USSD Pricing,’ which took effect from August 1, 2020, NCC stated: “MNOs must not charge the consumers directly for the use of USSD channel for financial services in the form of end-user-billing. The transaction should be between the MNOs and the entity to which the service is provided. “All billings by MNOs for financial service usingUSSD code assigned to financial service providers must thereby be implemented via the Corporate Billing model.” According to Danbatta, in the interest of the consumers and other stakeholders, the Commission revised the Determination previously issued by removing the Price Floor and the Cap to allow MNOs and the banks negotiate rates that will be mutually beneficial to all parties concerned.

Explaining the arrangement that existed between the telcos and the banks before suspension last year, Chairman of the Association of Licensed Telecommunications of Nigeria (ALTON), Gbenga Adebayo, said: “In order to accelerate the adoption of financial services on USSD, the banks partnered with our members to zero-rate the USSD access to endusers, while the banks bore the cost for the provision of service. “Based on this arrange ment, the banks took on the responsibility of billing customers and paid our members for use of the USSD infrastructure from the service fees deducted from the customer’s bank account. These service fees charged by the banks were however far in excess of the costs remitted to our members by the banks for providing the USSD platform and have since remained so.”

Adebayo noted that in view of the opposition to the implementation of end-user billing by customers, “our members, as responsible and responsive corporate citizens, are committed to safeguarding consumer interests and, in this regard, we are willing to explore mutually beneficial solutions, which ensure that costs associated with the provision of USSD services as determined by NCC are fully recovered by our members and customers are not billed twice for the same service and by different institutions, which is what end-user billing advocated by the banks will entail.”


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