Mobile-phone operators in Nigeria including MTN Group Ltd. and Airtel Africa Plc will stop providing dedicated text message services to banks until the lenders pay 120 billion naira ($259 million) in arrears.
(Bloomberg) — Mobile-phone operators in Nigeria including MTN Group Ltd. and Airtel Africa Plc will stop providing dedicated text message services to banks until the lenders pay 120 billion naira ($259 million) in arrears.
The operators will disconnect the so-called Unstructured Supplementary Service Data based on their contracts with the lenders, Gbenga Adebayo, chairman of the Association of Licensed Telecommunications Operators of Nigeria said in a telephone interview on Monday. Some banks will be disconnected as early as today, he said.
The service is crucial for the poor in Africa’s most-populous nation, where as many as 40% don’t have bank accounts. USSD is used for financial transactions such as transfers, bill payments and airtime recharges.
For two years, Nigeria’s mobile network operators and banks haven’t been able to agree on the appropriate USSD pricing model, the mode of collection and liability for unremitted fees from the lenders.
The telecom operators say arrears have risen from 42 billion naira 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 naira per transaction.
“We have engaged them severally but they refuse to do anything,” Adebayo said. “If we withdraw the service and they feel the impact, maybe they will come to find a way to resolve it.”
Herbert Wigwe, chief executive officer for Access Holdings Plc and head of the team engaging with the telecom operators couldn’t be reached for comment.
Wigwe in 2021 refuted claims that banks owed arrears to mobile-phone companies.
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