Nigerian Banks Begin Repayment of ₦200 Billion USSD Debt to Telcos

Nigerian banks have started repaying a ₦200 billion debt owed to telecom companies for the use of Unstructured Supplementary Services Data (USSD) banking services.

This debt, which has been a source of contention between banks and telcos for six years, required intervention from both the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC).

Following a meeting in late 2023, a repayment plan was agreed upon, and banks have now begun making payments. Central Bank Governor Olayemi Cardoso played a pivotal role in persuading the banks to start clearing the debt.

Despite this progress, Gbenga Adebayo, president of the Association of Licensed Telecommunication Operators of Nigeria (ALTON), has expressed concerns about the slow pace of repayment. “If you look at the number, it is not going down. The ₦200 billion, which consists of the principal sum and the interest, is likely to rise if the payment continues to drag. We believe that our friends in the banks can do better than what they are doing.”

One source suggested that the sluggish repayment is a tactic by banks to pressure telcos. A banking executive, who preferred to remain anonymous said, “There was no agreement between the banks and telcos about sharing USSD fees from the beginning. The banks only discovered the telcos were interested in the fees when they started to threaten to cut the service.”