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Digital Times Nigeria
Home » Telcos Set To Disconnect Banks Over N120 Billion USSD Debt
Telecoms

Telcos Set To Disconnect Banks Over N120 Billion USSD Debt

mmBy Rommy Imah13 May 2023No Comments4 Mins Read1 Views
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The Nigerian Communications Commission (NCC) has granted approval for Mobile Network Operators (MNOs) to disconnect Deposit Money Banks (DMBs) if they fail to pay the debt owed to Operators for Unstructured Supplementary Service Data (USSD) services which amount to over N120 Billion.

The announcement for the approval was made by the Association of Licensed Telecommunications Operators of Nigeria (ALTON) on Friday, through a statement signed by its Chairman, Engr. Gbenga Adebayo and Head, Operations, Gbolahan Awonuga.

ALTON has, therefore, warned that In view of the foregoing, unless Deposit Money Banks meet their debt obligations, telcos will disconnect all banks indebted to them for USSD services rendered.

ALTON said the approval was granted despite multiparty stakeholder efforts to resolve the situation and prevent any impact on services, led by the Minister of Communication and Digital Economy, Prof. Isa Ali Ibrahim Pantam, the Nigerian Communications Commission, the Central Bank of Nigeria, along with MNOs and DMBs.

It stated that despite these efforts, the DMBs have continued to incur greater and greater debt, without making the commensurate payments, noting that every time some progress is made, the DMBs come up with reasons to take stakeholders several steps back.

“Members of the public will recall that MNOs and DMBs have had protracted disagreements concerning the appropriate USSD pricing model for financial transactions, transparency of charges, mode of collection and liability for payment of the outstanding and continuous service fees due to the MNOs (which currently stands at over N120 Billion).

“Due to the inability of MNOs and DMBs to reach an agreement on the issues, MNOs in 2021 sought to disconnect DMBs due to the unpaid debts which stood at N42 Billion at that time. However, the Hon. Minister of Communication and Digital Economy, Prof. Isa Ali Ibrahim (Pantami) intervened and asked the MNOs not to disconnect DMBs as the action will negatively impact on the Digital and Financial Inclusion policy of the Federal Government.

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“The Nigerian Communications Commission (NCC), Association of Licensed Telecoms Operators of Nigeria (ALTON), Association of Telecommunications Companies of Nigeria (ATCON) and Deposit Money Banks (DMB) represented by the Chairman, Body of Bank CEOs subsequently met on 15 March 2021 to discuss indebtedness of DMBs to MNOs for USSD services.

“Further to the meeting, CBN and NCC issued a joint press statement on the agreement reached by all stakeholders to this effect,” ALTON explained in the statement.

The telecom industry body further stated that the Minister of Communications and Digital Economy and the Nigerian Communications Commission (NCC) have made several efforts to get the banks to show good faith and sign an agreement, in the national interest, based on the resolutions reached at that meeting, but regretted that the patriotic intervention of the Hon. Minister and the NCC have been taken for granted by the DMBs, as two years after, the banks have failed to sign a final agreement.

“It is pertinent to note that the contract between MNOs and DMBs on the use of USSDs for banking transactions is strictly commercial and MNOs are at liberty to withdraw the services if it is established that the transaction is unprofitable to them.

“MNOs have invested billions of naira in expanding their systems to accommodate the USSD needs of DMBs over the years. This has resulted in more Nigerians having access to banking services in addition to enabling banks to trim down costs by requiring fewer branches to service their growing customers,” ALTON further said.

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The Association expressed regrets that its members are not getting paid for their services which have resulted in the debt that stood at N42 Billion in 2021 rising to over N120 Billion.

“It is obvious that the level of debt is unsustainable given the time/value huge cost of the continuous upgrade and operation of the systems and infrastructure dedicated to supporting USSD transactions of DMBs,” ALTON said in the statement.

#Deposit Money Banks #Disconnection #N120 Billion USSD Debt ALTON Featured Telcos
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Rommy Imah
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Rommy Imah is Founder/Editor of Digital Times Nigeria (www.digitaltimesng.com). He has been in active journalism in over two decades with a bias for technology and business reporting. He is particularly passionate about technology and how it can be used to transform human life, businesses and services.

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