Access, Zenith, UBA, Others to End USSD Charges From Deposits as New Billing System Set to Begin
- Bank and telecom customers will soon start to pay for using USSD services via deductions from their airtime instead of debits from deposits
- Telecommunication companies and commercial banks have begun talks to transition to an end-user billing system
- The move is a departure from the previous arrangement where commercial banks charged customers for USSD from their deposits
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
Telecommunication subscribers and bank customers will soon be charged for using Unstructured Supplementary Service Data (USSD) through deductions from their airtime.
Reports say talks have advanced between commercial banks and the telcos to introduce an end-user billing system.
Source: Getty Images
Customers to be charged for airtime for USSD
The move is a departure from the former corporate billing system, where bank customers were charged for USSD from their deposits.
The chairman of the Association of licenced Telecom Operators of Nigeria (ALTON), Gbenga Adebayo, disclosed that the discussions are ongoing and that the modalities are being put in place to incorporate subscribers, telcos and the banks in one suit.
The Guardian reports that the ALTON boss said the end-user billing system, which the banks have been promoting, might help against accumulated USSD debts, curtailing the impasse between the banks and the telecom operators.
Banks to end USSD charges on deposits
Adebayo said that the parties have commenced discussion to migrate to an end-user billing system without disruptions to services for subscribers.
He said when the talks are finalised, banks will no longer debit again, but it will go to customers' airtime instead of debiting their bank accounts.
According to him, the conversation has begun, and there will be a migration process that the parties will agree to, marking the end solution to the issue of USSD debts, which he said the banks have been advocating for.
A September 16, 2019, memo to ALTON from the Body of Banks’ Chief Executive Officers (BOBCEO) proposed an orderly implementation of end-user billing for bank customers, aligning it with standard practices for USSD billing.
According to reports, the bank bosses disapproved of sharing revenue from USSD transactions with the telcos, claiming that service providers, which supply the platform for USSD services, proposed to take a cut of N4.50k per 20 seconds from the charges paid by customers to the banks.
The banks opposed this, alleging that it would raise costs by 450% as of then.
However, the telcos rejected the proposal, citing various dynamics, including the technology involved.
The move to end USSD debts
They insisted on corporate billing, disclosing in 2020 that the banks refused to convene a meeting to discuss the issue.
The situation led to the accumulation of USSD debts, which are currently under a recovery system.
Subscribers are now charged N6.98k for every USSD transaction, effective March 16, 2021.
Legit.ng earlier reported that the Nigerian Communications Commission (NCC) reported a USSD debt of N160 billion, most of which has been recovered after telcos deactivated some banks for failing to pay.
Source: Getty Images
The ALTON chairman said that significant progress has been made in the debt recovery process.
MTN Nigeria recovers N32 billion in USSD debt
Legit.ng previously reported that MTN Nigeria says it recovered N32 billion from Nigerian banks as part of the N74 billion outstanding debt owed to telcos for USSD service charges.
The telecom firm revealed that about N42 billion remained outstanding, showing ongoing tensions in the dispute between banks and telecom firms.
The debt recovery comes amid interventions by the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) in December last year.
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Source: Legit.ng
