How Nigerian banks lied to frame-up MTN, others in the controversial USSD N4 charge

File image of mobile phone users engaged on their handsets
  • Nigerian banks want telcos to charge its customers for USSD services per a leaked memo.
  • What is USSD service and how will it affect consumers?
  • What are the regulators saying?

In a fire-for-fire approach, division ensued between Nigerian bank CEOs and the telecoms industry over a controversial N4 charge on USSD service.

In a text message over the weekend, MTN Nigeria had announced that its subscribers will start paying N4 per 20 seconds for USSD access to banking services effective Monday, October 21st, 2019. 

The telecoms firm also directed its customers to approach their banks for complaints.

What is USSD? Unstructured Supplementary Service Data (USSD) is a fast and simple solution for seamless financial transactions and payments using mobile networks.  


Most of the bank customers in Nigeria used it to make a cash transfer and pay utility bills.

Regulators kick

In a swift move, the telecommunications regulatory and its banking counterpart asked the telcos to suspend the approach immediately.

During the World Bank/IMF meeting in Washington D.C., last week, Godwin Emefiele, CBN governor, directed banks to cut off telcos that raise charges on USSD transactions while Isa Ali Ibrahim Pantami, Nigeria's Minister of Communications, directed the Nigerian Communications Commission (NCC) to suspend the new charge.


Banks deny directives to MTN

The CEOs of Commercial Banks in the country also denied directing MTN Nigeria to charge customers for using USSD channels for bank transactions.

Leaked memo contradicts Bank CEOs


A leaked memo seen by TheCable revealed that the banks proposed to telecom companies to charge customers directly for USSD services. This is against the initial denial by the Bankers.

The memo dated September 16, 2019, was addressed to the Association of Licensed Telecommunications Operators of Nigeria (ALTON).

How will this affect Nigerians?

If implemented by telcos, customers will bear the cost of paying more for banking transactions. Before now, customers pay as little as N20 for some USSD transactions, excluding bank charges to third parties.


Gbenga Adebayo, ALTON chairman, told The PUNCH in a telephone conversation, that the new charges as advised by the bank CEOs would amount to double billing to customers.

He said banks presently have rates ranges from N10 to N50, as N4.5 per 20 seconds amounts to a minimum of 0.08% and a maximum of 40% of the charges to customers.


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