Telecommunications operators in Nigeria have been barred by the regulatory agency for the sector, Nigerian Communications Commission (NCC) from charging users for Unstructured Supplementary Service Data (USSD) transactions. The NCC ordered operators to suspend implementation of its proposed end-user billings for USSD.
The NCC made the announcement in a revision of its policy on price determination for USSD service. The regulatory agency said it was necessary to resolve the protracted dispute between Mobile Network Operators and financial institutions on the proper amount to charge for the service as well as the billing method.
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USSD or Quick codes as they are commonly known is a protocol used by mobile phones to communicate with the computers of the mobile network operator. The codes are used mostly for bank transactions in place of internet based banking by most Nigerians.
Nigerians had expressed outrage when Telecom operators announced the implementation of end user billing towards the end of 2019. They had announced that customers who used USSD codes for financial transactions will have to charges to both their banks as well as the telecom operators.
Excerpts from the NCC amended policy which took effect from August 1, 2020, read;
“MNOs must not charge the consumers directly for the use of USSD channel for financial services in the form of end-user-billing. The transaction should be between the MNOs and the entity to which the service is provided. All billings by MNOs for financial service using USSD code assigned to Financial Service Providers must, thereby, be implemented via the Corporate Billing model.”
The NCC said the amendment was based on a directive from its supervising Minister, Dr. Isa Pantami of the Ministry of Communications and Digital Economy following a recommendation of the commission.
During the presentation of the recommendation of the NCC regarding the matter, Pantami said he took the decision because he was besieged by complaints from Nigerians regarding the planned billing by both parties.
According to the Minister; “USSD is a service to banks and not to the telecom consumers, and as such, banks should see themselves as corporate customers of telecom operators with a duty to pay for using the telecom network and infrastructure, including USSD channels extended to them for service delivery to their customers.”
“MNOs have no direct relationship to bank customers, and cannot, therefore, charge directly for the usage of USSD channel,” he said further.