The Nigerian Communications Commission (NCC) has issued a groundbreaking directive with significant implications for nine Nigerian banks and millions of consumers nationwide.
These financial institutions face imminent disconnection from their Unstructured Supplementary Service Data (USSD) codes due to outstanding debts.
This article provides a detailed analysis of the situation, the affected banks, potential consumer impacts, and what lies ahead if compliance is not achieved.
What Led to This Directive?
The NCC, in collaboration with the Central Bank of Nigeria (CBN), issued a Second Joint Circular on December 20, 2024, mandating all financial institutions to settle their outstanding debts to mobile network operators (MNOs).
As of January 14, 2025, nine banks have failed to comply with these regulatory requirements, with some invoices dating as far back as 2020. These debts, collectively exceeding ₦200 billion, have prompted the NCC to take decisive action.
Affected Financial Institutions
The banks at risk of losing access to their USSD services include:
- Fidelity Bank Plc
- First City Monument Bank (FCMB)
- Jaiz Bank Plc
- Polaris Bank Limited
- Sterling Bank Limited
- United Bank for Africa Plc (UBA)
- Unity Bank Plc
- Wema Bank Plc
- Zenith Bank Plc
These institutions collectively serve millions of Nigerians who depend on USSD services for seamless banking operations.
Impacted USSD Codes
The USSD codes likely to be affected include:
- 770 – Fidelity Bank
- 919 – UBA
- 822 – Sterling Bank
These codes, among others, serve as critical channels for transactions such as balance inquiries, fund transfers, airtime purchases, and loan applications.
Consumer Impact and Service Disruptions
Reduced Accessibility for Banking Services
If these banks fail to settle their debts by January 27, 2025, consumers will lose access to essential services via USSD.
This disruption could be particularly detrimental to individuals without smartphones or internet access, who heavily rely on USSD for banking.
Potential Reassignment of USSD Codes
The NCC has indicated that these codes may be reassigned to other applicants. If this happens, customers will need to adapt to new banking codes, creating confusion and logistical challenges.
Regulatory Compliance and Consumer Protection
The NCC’s decision underscores its commitment to regulatory compliance and consumer protection. By holding banks accountable, the commission aims to ensure fair play among stakeholders in the financial and telecommunications industries.
NCC and CBN’s Joint Efforts
The collaboration between the NCC and the CBN is pivotal in safeguarding consumer interests. The joint circular issued in December 2024 emphasized that compliance with financial obligations is a prerequisite for USSD code renewal.
Consumer Advisory
To minimize inconvenience, the NCC has advised consumers to explore alternative banking channels such as mobile apps and internet banking. Customers are also encouraged to verify their banks’ compliance status.
The Future of USSD Banking in Nigeria
USSD banking has transformed the financial landscape in Nigeria, offering a simple and accessible platform for transactions. Between January and June 2024, 252.06 million USSD transactions were recorded, amounting to an impressive ₦2.19 trillion. However, unresolved issues between banks and MNOs threaten the sustainability of this channel.
Long-Term Solutions
To avoid future disruptions, stakeholders must prioritize:
- Debt Resolution Mechanisms: Establishing transparent frameworks for timely settlement of invoices.
- Policy Enforcement: Strengthening regulatory oversight to ensure strict adherence to financial obligations.
- Consumer Awareness: Educating customers on alternative banking channels and code reassignments.
Conclusion
The impending disconnection of USSD services for nine Nigerian banks highlights critical gaps in regulatory compliance within the financial sector.
As the January 27, 2025, deadline approaches, affected banks must urgently resolve their outstanding debts to avoid service disruptions that could impact millions of consumers.
Meanwhile, the NCC and CBN’s collaborative efforts demonstrate a commitment to protecting consumer interests and ensuring a stable banking ecosystem in Nigeria.
By providing actionable insights and detailed analysis, we aim to keep readers informed and prepared for the evolving landscape of USSD banking in Nigeria.