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Home African

The ALTON Backed MTNN, Glo, Airtel & Others To Disconnect Indebted Banks From USSD

The Nigeria tech landscape faces regulatory intervention via USSD disconnection per debt settlement.

Emeka Eni by Emeka Eni
May 9, 2023
in African, Telecom
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Backed by the Association of Licensed Telecommunications Operators of Nigeria (ALTON), mobile operators in the country have consented to disconnect commercial banks from their USSD channel and recover debts. The new policy by ALTON scolds commercial banks and other financial institutions from accessing dedicated messaging services until their debt is settled.

The ALTON agitates on recovering debts commercial banks owe mobile network providers for accessing the USSD channel serving as an offline electronic payment solution. Commercial banks have arrear debts worth ₦120 billion – a hefty amount for mobile network providers and its agency for defaulting business corporations.

ALTON’s chairman Gbenga Adebayo initiated the bid for commercial banks and other financial institutions contracted with the likes of MTNN, Airtel, Glo, 9mobile, and other mobile network providers to access their USSD channels to process electronic payment. 

This bid also calls out for other agencies regulating the financial institution landscape — the CBN consents to detest ALTON’s bids to keep the USSD network in service. However, the ALTON and the CBN will have to meet for a truce or some settlement standards to preserve the corporation with both sectors since debt is an inevitable factor in business.

This policy is only applicable to financial institutions indebted to mobile network providers, which mandate recovering arrear debts and settlement or encountering a disconnected USSD network from their banking operations. However, Gbenga reported that some banks are in debt and continue to use the USSD channel – “these sets of commercial banks will be disconnected today from the principal mobile network providers.”

“The telecommunications operators say arrears have risen from ₦42 billion in 2021. The industry regulator and the Central Bank of Nigeria intervened in the dispute that year leading to an agreement for a flat fee of ₦6.98/transaction.”

“We have engaged them severally but they refuse to do anything,” Gbenga said. “If we withdraw the service and they feel the impact, maybe they will come to find a way to resolve it.” The ALTON’s chairman ordered the disconnection to persuade debtors to consider arrear debts settlement which will appease its agency as well.

Gbenga also noted that the sanctions on financial institutions are a temporary plea for debtors while mobile network providers and commercial banks agree on the appropriate USSD pricing model. The ALTON bids for its landscape and the financial sector to consent on the mode of collection and liability for unremitted fees from the indebted commercial banks.

Recall that the USSD portal is used for financial transactions such as transfers, bill payments, and airtime recharges. Disconnected commercial banks from the USSD network will recall why the USSD is another significant electronic payment Infrastructure that needs to be active because it processes remittances without an internet connection.

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Tags: ALTONnigeriaTelecom agency
Emeka Eni

Emeka Eni

I am a tech enthusiast, creating contents, graphic designer and am Africa.

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