USSD: More Banks Pay MTN, Airtel, Others as Telcos Reject Possible Extension Deadline
- The NCC and telecom companies have refused to extend the period for banks to settle their USSD-related debts
- As a result, defaulting lenders are scrambling to meet the deadline by Monday's close of business
- This development follows the telecom regulator's January 15, 2025, warning to the nine banks
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Telecommunications firms and the Nigerian Communications Commission have rejected extending the timeframe for banks to pay off their obligations related to Unstructured Supplementary Service Data.
Source: UGC
In light of this, lenders that are in default are rushing to fulfil the deadline by Monday's close of business.
The telcos to The Punch said that by Friday, there were only seven banks in arrears, down from nine at the beginning. Only two lenders had paid out of these. Six banks remained in arrears as of Monday's end, with one more bank indicating its intention to settle.
This development comes after the telecom regulator warned the nine banks on January 15, 2025, that they must pay off their debts by January 27, 2025, or else they risk losing their USSD codes, which are crucial for allowing millions of Nigerians to conduct banking transactions without internet access.
Gbenga Adebayo, the chairman of the Association of Licensed Telecommunications Operators of Nigeria, told The Punch that as of Friday, there were just seven banks in default. Only two banks, though, had finished paying.
“One of these seven has reached out to confirm that they will settle their debt today (Monday), which will leave about five or six banks still outstanding,” Adebayo explained.
Adebayo clarified that the current enforcement is a component of the first stage of a structured payment scheme that was described in a memo from the NCC and the CBN on December 20.
With distinct due dates for each phase, the document outlines a three-phase payment obligation for banks to satisfy the N250 billion USSD debt.
By January 2, 2025, banks must settle 60% of all outstanding pre-API invoices as part of the first phase.
Adebayo emphasised that this initial stage is crucial because if it is not completed by the deadline, USSD services—a crucial conduit for the millions of Nigerians who depend on mobile banking for daily transactions—may be disconnected.
“This is just the first phase of the directive. We hope that banks who have complied with this phase will continue to meet their obligations in subsequent ones,” he said.
Banks must fully settle all pre-API invoices by July 2, 2025, as part of the second phase. The third step then requires that 85% of post-API invoices be settled by December 31, 2025.
“When it comes to the second and third phases, we expect full compliance,” Adebayo noted. “Non-compliance at any stage will have consequences, and we hope to avoid any disruption of services.”
Adebayo denied the prospect of an extension when questioned, claiming that both regulators would need to agree on any such decision.
“No, there will be no extension. If there is to be one, it would require joint approval from the NCC and CBN, but I doubt that either regulator would act without consulting the other,” he explained.
In order to prevent disruptions to the mobile banking services that millions of Nigerians depend on, the chairman of ATCON encouraged banks to comply.
“It’s crucial for non-compliant banks to settle their debts to ensure we don’t disrupt the economy and the digital services subscribers depend on,” Adebayo added.
Reuben Mouka, the NCC's Director of Public Affairs, told The Punch that the deadline is in accordance with the commission's January 15 instruction.
“We have clearly stated in our publications that disconnection will occur if banks fail to meet the payment deadline,” Mouka said. “It is now up to the telecom operators to decide whether or not to disconnect the services.”
Banks rush to settle USSD debts ahead of deadline
Legit.ng reported that with the January 27, 2025, deadline approaching for the disconnection of Unstructured Supplementary Service Data (USSD) services from nine commercial banks, affected banks are taking steps to clear their debts.
Some banks have already started paying off part of their debt, while others who hadn’t made any moves before are now seeking to negotiate despite previously resisting the sanctions.
The Nigerian Communications Commission (NCC) listed the defaulting banks to include Zenith Bank, United Bank for Africa (UBA), Wema Bank and Sterling Bank.
Proofreading by Nkem Ikeke, journalist and copy editor at Legit.ng.
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