Nigerian Communications Commission (NCC), Central Bank of Nigeria (CBN), and Body of Bank CEOs are to meet to resolve the dispute surrounding charges for use of Unstructured Supplementary Service Data (USSD), the Nation reported.

First Bank USSD Account Opening

According to Wikipedia, ‘USSD, sometimes referred to as “Quick Codes” or “Feature codes”, is a communications protocol used by GSM (global service for mobile communications) cellular telephones to communicate with the mobile network operator’s computers. But it is now used for transferring cash and transacting other banking services by customers in line with the cashless policy of the CBN.

According to the Nation. the USSD services of the lenders include GTB’s *737#; First Bank’s *894#; Fidelity Bank’s *770#; Access Bank’s *901#; and UBA’s *919#. They all run on telecoms infrastructure.

While there is an initial charge of N50 by the bank, which will be retained, customers who use the USSD will be made to pay additional N4, which would have automatically translated to double billing.

The meeting, which would hold early in the new year, would be at the instance of the NCC and the CBN. It is expected, among other things, to end the bickering by the telcos over their denial to charge customers for using the platform for banking transactions.

The telcos had threatened to invoke the relevant sections of the Nigeria Communications Act 2003 by disallowing the banks further access to the USSD link over the conspiracy of silence by the relevant stakeholders after Dr Isa Pantami, Communications and Digital Economy minister, had ‘directe’ the NCC to bar the telcos from collecting charges for use of the infrastructure they built with their cash.

But a source in the NCC said the regulator had not abandoned the telcos.

“We are on top of the situation. We have not abandoned the telcos as alleged. You know the issue concerns multiple stakeholders. You will agree with me that it is not so easy to iron the matter because of this. But let me assure you that as a responsive regulator, we will collaborate with the CBN as we did during the 9mobile crisis to prevent any problem. You should also remember that this issue at stake touches that heart of the policy of the Federal Government,” the source said.

Gbenga Adebayo, chairman, Association of Licensed Telecoms Companies of Nigeria (ATCON), said the USSD channel has evolved from a telco exclusive channel used for only telco services, such as balance inquiry and recharges, to a channel being utilised for the deployment of financial, insurance, agricultural and government services, etc. The USSD channel is delivered using the Standalone Dedicated Control Channel (SDCCH) which is also used for call set-up, SMS set-up, and delivery.

Similar to the other telco services such as SMS, voice and data, network resources are utilised in the provisions of USSD services and as such there are significant costs associated with deploying and maintaining the service.

“The banks, however, identifying the convenience of delivering services to its customers over the USSD channel applied to the NCC for USSD codes to deliver these services. USSD Shortcodes were thereafter issued to the banks and as is expected, they became fully responsible for the charges associated with delivering services to their customer through these shortcodes.

“To accelerate the adoption of financial services on USSD, the banks partnered our members to zero-rate the USSD access to end-users, while the banks bore the cost for the provision of service,” he said.

Based on this arrangement, the banks took on the responsibility of billing customers and paid our members for use of the USSD infrastructure from the service fees deducted from the customer’s bank account.

These service fees charged by the banks were however far over the costs remitted to our members by the banks for providing the USSD platform and have since remained so.

“Following the issuance of the USSD Pricing Determination by the N CC which resulted in a price review of USSD service by our members, the banks stated that they would no longer pay for USSD service delivered to their customers and requested our members to charge customers directly for use of the USSD channel. This billing methodology where the Banks customer is directly charged USSD access fees by our members irrespective of the service charges that the bank may subsequently apply to the customers’ bank account is called “End-User Billing” which the banks specifically demanded that all our members implement. The banks, however, provided no assurances to our members that such service fees charged to customers’ bank accounts for access to bank services through the USSD channel will be discontinued post-implementation of end-user billing by our members,” Adebayo said.

He said the removal of these service fees by the banks would have meant that if bank customers were charged only the USSD costs communicated by our members per USSD session, bank customers will be paying far less than what they are currently being charged by the banks which in some instances are as high as N50.

“Our members were however concerned that the banks were unlikely to discontinue the USSD service fees charged by the banks when customers utilise the USSD channel thereby resulting in double and overbilling, whereby our members charge consumers for the USSD access from their airtime and the Banks still proceed to charge the same consumers a service charge from their bank accounts. In the interest of the consumers, our members challenged the implementation of end-user billing until a formal request for its implementation was received from the Body of Bankers Chief Executive Officers and several banks specifically demanding that end-user billing be implemented.

“In view of the opposition to the implementation of end-user billing by customers, our members, as responsible and responsive corporate citizens are committed to safeguarding consumer interests, and in this regard, we are willing to explore mutually beneficial solutions which ensure that costs associated with the provision of USSD services as determined by the NCC are fully recovered by our members and customers are not billed twice for the same service and by different institutions which is what end-user billing advocat