In a fresh wave of tension between Nigeria’s telecom operators and commercial banks, the Association of Licensed Telecom Operators of Nigeria (ALTON) has strongly opposed the recent move by Deposit Money Banks (DMBs) to begin deducting Unstructured Supplementary Service Data (USSD) fees directly from customers’ airtime balances.
The dispute, which reignites long-standing friction over USSD service charges, surfaced after banks including First City Monument Bank (FCMB) and StanbicIBTC issued official statements to customers on June 3, announcing that henceforth, USSD banking charges would no longer be deducted from bank accounts but from mobile airtime, in line with what they claimed was a directive from the Nigerian Communications Commission (NCC).
According to the banks, the updated model—known as the End-User Billing (EUB) system—will charge N6.98 per 120-second USSD session. Customers are expected to receive a prompt requesting consent before airtime deductions take place.
However, telcos under ALTON have rejected the new billing model rollout, stressing that no final agreement has been reached among the banks, telecom operators, and the regulator to implement the change. ALTON Chairman, Gbenga Adebayo, told The Guardian in an exclusive interview that many banks still owe parts of the historic ₦160 billion debt related to previous USSD charges, and the transition to end-user billing cannot proceed until those debts are settled.
“We have not concluded the modalities and agreements needed for this migration,” Adebayo said. “We’re surprised that the banks went ahead with the announcement.”
He clarified that the industry had tentatively set June 2, 2025, as the date for the transition, but this was conditional on two things: complete debt repayment by banks and a mutual Service Level Agreement (SLA) outlining billing transparency, avoidance of double billing, and customer consent protocols.
At the heart of the USSD saga is a long-standing financial impasse between telcos and banks. Telecom firms allege that banks have accumulated a debt estimated at ₦160 billion by November 2023, which remains largely unpaid despite partial repayments by some banks earlier this year.
The NCC, which serves as the industry regulator, previously intervened to mediate the dispute. One resolution involved banks agreeing to repay debts accrued under the corporate billing model—where USSD charges were borne by the banks on behalf of customers—before migrating to the end-user model.
Adebayo made it clear that only banks that have cleared their outstanding debts and agree to the standard service protocols will be allowed to transition to the airtime deduction model.
“If any bank tries to implement this billing unilaterally, we will disconnect them from USSD services,” he warned. “We cannot allow a breach of trust or disruption of service standards.”
Although banks have cited the NCC as the source of the directive, telecom operators say they have not received any formal approval or joint implementation guidelines from the commission. This has cast doubts over the regulatory clarity and coordination between NCC, telcos, and DMBs.
Sources within the telecom industry suggest that the absence of a centralized framework could expose customers to double billing—where deductions occur both from airtime and bank accounts—or billing for incomplete or failed sessions, further eroding trust in USSD banking services.
The NCC-endorsed EUB model aims to make USSD service provision more sustainable and fair by ensuring that users pay for what they use. While the ₦6.98 per session fee may appear modest, consumer rights advocates warn that the new system could discourage low-income users from using USSD—a vital financial inclusion tool for millions without smartphones or internet access.
Banks have urged customers to consider alternative channels, such as mobile apps, ATMs, and internet banking, especially those uncomfortable with the new airtime deduction system.
Despite the public notices, confusion remains. With no final SLA, inconsistent messaging from banks, and unresolved debt issues, the move to end-user billing remains fraught with challenges.
Unless the Nigerian Communications Commission steps in with clear regulatory guidance, the dispute may deepen, affecting access to USSD services for millions. ALTON has reiterated its willingness to proceed—but only when mutual agreements are reached and debts are cleared.
As of now, the USSD billing controversy represents not just a financial standoff but a larger issue of industry trust, regulatory oversight, and customer protection in Nigeria’s fast-growing digital finance ecosystem.