Nigeria’s telecommunications industry has undergone a transformative shift with the introduction of the End-User Billing (EUB) framework for Unstructured Supplementary Service Data (USSD) services. Approved by the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN), this new model allows major operators—MTN, Airtel, 9mobile, and Glo—to directly deduct USSD service charges from subscribers’ airtime balances, eliminating banks as intermediaries. The reform, announced by the Association of Licensed Telecom Operators of Nigeria (ALTON) on Wednesday, aims to resolve long-standing disputes over unremitted revenues and enhance transparency in the sector.
The EUB framework marks a significant departure from the previous system, where banks collected USSD fees from subscribers but often failed to remit these funds to telecom operators. By the end of 2024, telecoms had provided over N200 billion in USSD services, yet faced persistent delays or non-payment from banks, according to industry stakeholders. “Banks would deduct charges from our accounts but not pass them on to the telcos, creating constant friction,” said Adeolu Ogunbanjo, President of the National Association of Telecoms Subscribers (NATCOMS), in an interview with The PUNCH.
Under the new arrangement, subscribers will be charged N6.98 per USSD session, lasting up to 120 seconds, only after receiving a prompt to opt in and authorize the deduction. This user-consent mechanism ensures transparency and protects subscribers from unauthorized charges. Ogunbanjo described the EUB model as a “long-overdue reform” that brings accountability to the USSD ecosystem, expressing optimism that it will spur telecom operators to improve service quality. “We hope this will push telcos to invest in better infrastructure and address issues like poor network performance,” he added.
**A Resolution to a Long-Standing Dispute**
The USSD billing controversy traces back to 2019, when telecom operators accused commercial banks of withholding payments for services rendered. USSD, a critical channel for mobile banking transactions such as balance inquiries, fund transfers, and bill payments, generates significant revenue but relies on seamless collaboration between telecoms and banks. The dispute escalated to the point where operators threatened to suspend USSD services for indebted banks, prompting regulatory intervention.
In 2021, the NCC and CBN introduced an interim solution, establishing a flat rate of N6.98 per USSD session to be collected by banks on behalf of telecoms. However, compliance remained inconsistent, with telecoms reporting ongoing delays in remittances. The EUB framework, developed after extensive consultations, addresses these challenges by empowering telecom operators to directly manage billing, ensuring prompt access to their revenue.
Gbenga Adebayo, Chairman of ALTON, hailed the transition as a “milestone in Nigeria’s digital financial ecosystem.” He emphasized that the new model prioritizes transparency, sustainability, and customer satisfaction while maintaining the integrity of USSD services. “Subscribers can continue using familiar USSD codes without disruption,” Adebayo assured, adding that existing services for banking and other transactions will remain fully operational.
**Industry and Consumer Implications**
The adoption of the EUB framework has already prompted action from major banks. Last week, institutions such as Guaranty Trust Bank (GTB), United Bank for Africa (UBA), and First City Monument Bank (FCMB) notified customers that USSD transaction charges would now be deducted directly from their airtime balances. This shift aligns with the NCC’s directive and reflects the banking sector’s cooperation with the new billing regime.
For subscribers, the change introduces a more straightforward billing process, with clear prompts to approve charges. Adebayo advised users to contact their mobile network providers for general USSD issues and their banks for transaction-specific concerns, ensuring clarity in resolving potential challenges. The NCC’s leadership in driving this reform, in collaboration with the CBN, has been widely commended, with stakeholders noting its potential to stabilize the USSD ecosystem.
The reform also carries broader implications for Nigeria’s telecommunications sector, which has faced criticism for inconsistent service quality despite its critical role in the economy. With direct access to USSD revenue, telecom operators are expected to reinvest in network infrastructure, addressing issues such as dropped calls, slow data speeds, and coverage gaps. Ogunbanjo stressed that consumers would hold operators accountable for delivering tangible improvements, given the financial benefits of the new model.
**A Step Toward Digital Financial Inclusion**
USSD services are a cornerstone of Nigeria’s digital financial ecosystem, particularly for millions of unbanked and underbanked citizens who rely on feature phones for mobile banking. The platform’s simplicity and accessibility make it a vital tool for financial inclusion, enabling transactions without the need for internet access or smartphones. By resolving the billing dispute, the EUB framework strengthens the sustainability of USSD services, ensuring their continued availability for both urban and rural populations.
The reform also highlights the importance of regulatory collaboration in addressing industry challenges. The NCC and CBN’s joint effort to mediate between telecoms and banks demonstrates a commitment to fostering a harmonious digital economy. As Nigeria continues to advance its digital transformation, such initiatives are critical for building trust among stakeholders and delivering value to consumers.
**Challenges and Future Outlook**
While the EUB framework is a significant step forward, its success will depend on effective implementation and monitoring. Telecom operators must ensure that billing prompts are clear and that deductions align with the approved N6.98 rate to maintain consumer trust. Additionally, the NCC and CBN will need to enforce compliance and address any emerging issues to prevent a recurrence of past disputes.
Looking ahead, the reform could set a precedent for other sectors reliant on multi-stakeholder ecosystems, such as mobile money and fintech. By prioritizing transparency and accountability, Nigeria’s regulators are paving the way for a more robust digital economy. For telecom subscribers, the hope is that the financial benefits reaped by operators will translate into enhanced services, making the EUB framework a win-win for both the industry and its customers.
