The Nigerian Communications Commission (NCC) has directed telecommunications operators to disconnect Unstructured Supplementary Service Data (USSD) codes assigned to nine financial institutions by January 27, 2025, unless the banks settle outstanding debts.
The directive, outlined in a public notice signed by the NCC’s Director of Public Affairs, Reuben Muoka, emphasizes that failure to comply will result in the reassignment of these codes to other applicants. This decision stems from prolonged unpaid debts, with some invoices dating back to 2020. As of January 14, 2025, nine out of the 18 affected financial institutions had not fulfilled their financial obligations.
Banks At Risk of Losing USSD Codes
The impacted banks include Fidelity Bank Plc, First City Monument Bank, Jaiz Bank Plc, Polaris Bank Limited, Sterling Bank Limited, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc, and Zenith Bank Plc. USSD codes such as 770, 919, and 822 are among those at risk of disconnection.
According to the NCC, the unpaid debts initially amounted to over N200 billion. Although other financial institutions have cleared their arrears, the exact amount currently owed by the nine defaulting banks remains undisclosed.
Impact on Consumers and Financial Inclusion
USSD codes serve as a critical tool for mobile banking, allowing millions of Nigerians to perform financial transactions without internet access. Between January and June 2024 alone, the Central Bank of Nigeria (CBN) recorded 252.06 million USSD transactions valued at N2.19 trillion. This represents significant growth compared to 2023 figures, where 630.6 million transactions worth N4.84 trillion were conducted via USSD.
The NCC’s notice warns that if the affected banks fail to comply with the Second Joint Circular issued by the CBN and NCC on December 20, 2024, consumers may experience service disruptions. Additionally, the non-compliance disqualifies these banks from meeting the requirements for renewing their USSD codes.
A Persistent Industry Challenge
The tension between telecom operators and financial institutions over unpaid USSD-related debts is not new. Telecom operators originally developed USSD technology for airtime purchases and subscription services. However, its adoption by banks has made it an essential component of financial inclusion efforts, particularly for users in rural or underserved areas without internet connectivity.
The NCC has reiterated its commitment to consumer protection and urged the affected banks to take immediate action to avoid disrupting access to financial services. The regulator noted that the decision was made after exhausting other avenues to encourage compliance, including prior notifications and reminders to settle outstanding obligations.
As the January 27, 2025, deadline approaches, the spotlight remains on the financial institutions to address this issue and prevent widespread service disruptions for millions of Nigerians reliant on USSD banking services.
This report is brought to you by Hobnob News.
