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The Executive Vice Chairman of the Nigerian Communications Commission, Prof. Umar Danbatta, has emphasized that the outstanding N120 billion Unstructured Supplementary Service Data (USSD) debt owed by banks to telecommunications companies is impeding the progress of financial inclusion in the country.
He underscored that the USSD service plays a pivotal role in driving digital financial inclusion, currently estimated at 60 to 70 percent in Nigeria. Without it, the country’s digital financial inclusion landscape would not have achieved its current status.
Danbatta stated, “The significance of this service lies in the fact that digital financial inclusion, with a penetration rate currently at about 70 percent, is predominantly powered by telecommunications companies. Therefore, there should be no hindrance to compensating them for this essential service.”
He continued, “No service is provided for free. The simple request is to honor the payments to the telecom companies. Settle the accumulated debt, and remunerate them for their ongoing service.”
The disclosure was made during the Telecom Executives and Regulators Forum organized by the Association of Telecommunications Companies of Nigeria (ATCON) in Lagos.
Danbatta revealed that banks had now reached an agreement to settle the debt for USSD services, owing to consistent interventions from the Nigerian Communications Commission (NCC) and the Acting Governor of the Central Bank of Nigeria, Folashodun Shonubi.
He stated, “This marks a significant development for the telecoms industry, as we have successfully resolved the issue amicably. We are all working to serve the same government. We aim to maintain the continuity of financial services in the country. This pertains to telecommunications service providers as well, and we aspire to see even greater penetration in the financial inclusion index.”
Danbatta emphasized the importance of settling the historical debt and ensuring payment for the ongoing services provided. This resolution brings an end to the protracted dispute between banks and telecoms regarding the USSD infrastructure. The USSD debt has grown significantly since 2019, reaching N120 billion by the end of 2022. At various points, telecom companies had threatened to disconnect banks from utilizing this critical infrastructure.
According to Gbolahan Awonuga, Head of Operations at the Association of Licensed Telecommunications Operators of Nigeria, some banks have initiated payments for their USSD debt, although the overall amount paid to date remains relatively low.
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