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Mobile Payments Forget apps, USSD is the ‘Fintech’ Nigerians truly need

Okay, don't completely forget the apps, but chill at least.

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Nigerians have chosen many alternatives to paper money, but USSD is the way of the people.

Fintech sounds like a really badass word (it is), until you realise that it’s simply just used to describe any technology used to enable banking and financial services. 

The Nigerian Fintech industry might not be at par with other more advanced countries, but it is growing exponentially. 

From Paystack raising over a million dollars in seed funding, to the Flutterwave storm. Let’s not forget that Paga is doing great numbers. And this is just to name a few.

But if there’s anyone I honestly think deserves most of our attention, it’s the USSD payment system. 

USSD is short for Unstructured Supplementary Service Data. But forget the big words, it’s how your phone, no matter how basic, uses codes to connect to computer servers. 

Remember that code you use to check airtime? *419#? Yeah, that’s USSD. I recently completed a road trip of the entire Nigeria, for 80 days. And I carried out an experiment. I tried to use Access Bank’s *901# to make payments everywhere possible, in as many ways as was possible. 

So *901# saw me paying for a hotel in Uyo, Akwa Ibom State. All I had to do was get the account number, make a quick transfer at the reception, and I had a bed to myself. In Gembu, Taraba State, the ATMs weren’t dispensing, and the Internet was really bad. I needed to be in Jalingo that day, about six hours away, so I approached a driver. He didn’t speak any English, but I got someone to translate. 

In less than 10 minutes, I was sitting in the back with other passengers, heading for Jalingo. I paid for my seat with USSD. Many hotels I paid with USSD that I have now lost count of. Daura, Ile-Ife, Kainji, Lafia, Jalingo, Kebbi, Bauchi. 

Why is it so normal in some of these places?

I think this was the most surprising part. The fact that you simply asked, “do you have an account number I can transfer to,” and all they had to say was yes we do. Without hesitation. 

According to a 2017 Mobile Money Report by the Mobile Ecosystem Forum: 

“The number of transactions performed using the USSD service has more than doubled the number of transactions on mobile banking platforms for banks offering USSD.”

Let’s try to compare this with the other mobile payment option. Take the GT Bank app for example, it can take up to 100MB of internal storage memory on a phone. The Stanbic IBTC app uses over 80MB of internal memory. And it’s not just these picks, many apps are pretty large in the mobile sense. 

According to the Twin Pine Mobile Report of 2017, the number one reason people uninstall apps is because of file size. Due to spending power and cost of living, the average phone price tends to drop as you move from urban centres to rural communities. The same can almost be said for quality of Internet. 

Cheaper phones means, lower smartphone power, or no smartphone at all. One thing every phone has though, is the power of USSD. 

We have to make this better. 

USSD can already do so much even in terrible network conditions. It can make payments. Buy airtime. Pay bills. 

The focus, now, should be making it work as seamlessly as possible. A million people might love the nice apps. But for a Nigeria of over 190 million people and a mobile penetration of about 74%, the lighter, readily-available USSD, is the real bae. 

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