In October 2019, MTN Nigeria sent a notification to its customers that it would begin charging them a fee every time they used Unstructured Supplementary Service Data (USSD) codes to make bank transactions.
It followed a new decision from the Nigerian Communications Commission (NCC) a month before that allowed telcos to charge customers directly for those transactions. Because USSD transactions are done via mobile networks, they cost money and someone has to pay.
In the beginning, the plan was for banks to pay those charges which telcos say are around N12 for one session and then remit it in bulk to the telcos. The banks balked at that plan and asked telcos to charge customers directly.
A lot has happened in that time, with the telcos threatening to block banks from accessing USSD first in 2020 and then early this week. Now the NCC and Central Bank have stepped in with a solution.
The solution: Customers will now pay N6.98 per USSD transaction and this is already in addition to the N10.75 banks charge.
Why are people so worried? USSD has been a big driver for financial services in Nigeria, reporting billions in transactions monthly. There’s a big worry that additional charges could push people away from using USSD.
Looking forward: I’ve had a range of interesting conversations about today’s decision and you can look out for my analysis of all the issues surrounding USSD later today!