The Central Bank of Nigeria (CBN) intervened to break the standoff between telecom operators and deposit money banks (DMBs) over the accumulated N120 billion in unstructured supplementary service data (USSD) debt, according to the Nigerian Communications Commission (NCC).
Prof. Umar Danbatta, Executive Vice Chairman of the Nigerian Communications Commission (NCC), revealed this yesterday in Lagos and claimed that the situation had been fairly settled.
He emphasized that the USSD was crucial in closing the gap in the country and that financial inclusion has already reached 70% with the aid of the telecoms sector.
At the Telecom Executives and Regulators Forum (TERF) held in Lagos, Danbatta stated that the banks had agreed to pay off the accumulated debt and keep paying for the USSD service moving forward under the corporate billing term following the intervention of Acting Governor of the CBN, Folashodun Shonubi.
The issue was rectified, according to the EVC, at a recent meeting between the interim CBN Governor, the NCC, telecom providers, and banks.He claimed that the realization that telecoms services are necessary for financial inclusion led to the resolution's success.
Danbatta recalled that banks' insistence on end-user charging rather than corporate billing caused debt accumulation as the problem's root cause.
The banks receive the USSD service, which they then pass along to their consumers. Who should be responsible for paying for the service was the issue.
We responded, "The service is being given to the banks, not to their customers. They demanded end-user billing. It's neat that the banks bill their consumers for the service and are required to pay the telcos via corporate billing.
"Then, somewhere along the line, there was a miscommunication, and the debt accumulated until it grew enormously to be over N100 billion.
Even so, the banks continued to offer the service to consumers while utilizing the telecom infrastructure for free. This occurred despite the former Minister's intervention, according to Danbatta.
He pointed out that up until recently, when the Acting CBN Governor stepped in, the situation had not changed. According to the EVC, the head of the top bank stated that without the USSD service, there would be no digital financial inclusion and nowhere near the level of penetration that it is today.