NCC: Nigerian banks, not customers, to pay for USSD sessions

by | Aug 7, 2020

On August 5, the Nigerian Communications Commission (NCC) released a revision of the charges on Unstructured Supplementary Service Data (USSD) services. This decision was officially released on July 24, 2020.

Taking effect from August 1, this review is to immediately replace the directive which was published on July 23, 2019, and effected from September 1 of the same year.

This revision removes the previous cap and floor prices — ₦1.63k and ₦4.89k respectively — per 20-second USSD session and now pegs it at ₦1.63k per session. But the price is still open to deliberation among the concerned parties.

Another notable change resulting from this revision is that USSD charges should be a corporate charge between the financial institutions and the network providers. Thus, customers should not be involved.

Advertisement

Relevant stakeholders are then expected to reach an agreement on how the charges will be collected. But as it stands, the NCC reported that banks have an outstanding ₦17 billion ($43.9 million) to pay network providers on USSD services.

From what was gathered, these charges began accumulating after the Minister of Communications and Digital Economy, Isa Pantami suspended banks’ demand for telcos to charge the consumers directly for USSD services.

The Commission claims the goal for this revision is to protect consumers and telcos interests.

The implication of this is that instead of users airtime to be deducted during a USSD transaction, the network providers charge their respective banks.

It should be noted, however, that end-user and corporate payments of USSD charges is not new.

At the time when the Determination of USSD Pricing was first released, our investigation showed telcos like 9Mobile and Airtel charged customers directly while MTN charged banks. But it soon didn’t work out for MTN.

Recall that sometime in October 2019, MTN informed its customers of a ₦4 airtime deduction for every 20-second USSD session, a decision that was blamed on banks.

Even though all telcos have since stopped charges, this new directive perhaps puts to bed the different instances of denial and finger-pointing exposed in this Techpoint Africa article.

Advertisement

Telcos, Bank CEOs, and USSD charges: A two-faced narrative of silence and finger-pointing

While there might not be direct end-user billing, it is suspected that banks would probably devise an unceremonious way of making such deduction; perhaps through miscellaneous charges like SMS, card maintenance, or stamp duty.

Looking to transition into tech? Learn how to code in 1 year with AltSchool Africa. Earn a diploma in software engineering at $0. Apply Here.

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Recent News

Betting $165 million on Africa’s B2B eCommerce in 2021

Betting $165 million on Africa’s B2B eCommerce in 2021

While Africa’s eCommerce struggles frequently make the news, investors have bet a combined $165 million on a growing class of startups in 2021. Today on #TechpointDigest, @eruskkii discusses the rise of B2B marketplaces in Africa.

Subscribe to Techpoint Digest!

A daily 5-minute roundup of happenings in African and global tech, sent directly to your email inbox, between 5 a.m. and 7 a.m (WAT) every week day!

Please check your email to confirm your subscription.

Subscribe to Crypto Explorer

A monthly series featuring in-depth analysis on the cryptocurrency sector in Africa

Please check your email to confirm your subscription.

Subscribe to The Experts

A bi-weekly where tech career specialists take us on their journey from newbie to expert, and how they became successful in the industry.

Please check your email to confirm your subscription.

Subscribe to Founder's Table

A monthly series, where we catch up with founders in the startup ecosystem, learn about their failures, successes and a few tricks of the trade

Please check your email to confirm your subscription.

Copy link
Powered by Social Snap