19 Nov 2023
Nigerian telecom operators have demanded urgent settlement of Unstructured Supplementary Service Data (USSD) debts owed to them by Deposit Money Banks (DMBs), amounting to a staggering $200 billion. The Association of Licensed Telecommunications Operators of Nigeria (ALTON) has raised the alarm over the escalating debt, which they claim is threatening the sustainability of their operations and the quality of services provided to millions of Nigerians.
The issue has been simmering for years, with repeated appeals and interventions by the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) failing to yield any tangible results. ALTON Chairman Gbenga Adebayo expressed frustration over the banks' silence on the matter, emphasizing that the entire debt must be settled without further delay.
The USSD system plays a crucial role in various mobile services, including mobile banking, balance inquiries, and prepaid mobile recharges. However, the unpaid debts have placed immense strain on the system, jeopardizing the ability of telecom companies to maintain and improve service infrastructure. This, in turn, directly impacts the customer experience, leading to potential degradation of service quality, disruptions, slower response times, and even service outages.
The financial constraints imposed by the USSD debts could also hinder the introduction of new and improved services. Innovations that could enhance customer convenience and experience may be delayed or shelved altogether, leaving customers yearning for enhanced features and functionalities that could have otherwise been implemented.
Customers themselves are not immune to the ripple effects of the USSD debt crisis. Delayed new features directly impact user satisfaction, while interruptions in mobile banking transactions, often reliant on USSD codes, could lead to inconvenience for users who depend on these services for their day-to-day financial activities. Furthermore, there is the potential for increased costs to be passed on to consumers, with telecom operators potentially adjusting service charges or introducing additional fees to offset financial losses.
The Nigerian telecommunications industry faces a range of challenges, including regulatory complexities and foreign exchange fluctuations. These factors hamper innovation, increase operational costs, and hinder investment in technology and infrastructure. The USSD debt issue further exacerbates these challenges, introducing a layer of financial uncertainty that threatens the industry's sustainability.
Despite these obstacles, the telecommunications sector plays a vital role in economic and social development. Collaborative efforts between stakeholders and regulators are essential to establish clear regulations and mechanisms, fostering a thriving telecommunications sector in Nigeria. The Nigerian Communications Commission (NCC) has a crucial role to play in mediating discussions between telecom operators and DMBs, providing guidance on regulatory frameworks, and facilitating resolutions to financial disputes within the industry.