The Nigeria's telecommunication companies and banks have come to a conclusion that any bank transactions carried out via Unstructured Supplementary Service Data (USSD), its fee will be charged directly from user's airtime balance.
This policy is called End-user Billing. End-user billing means that the user (you) is directly charged from their airtime balance whenever they use a USSD service—for example, checking your bank balance or transferring money using a USSD code.
Instead of the bank covering that cost behind the scenes and then charging you later (or bundling it into other fees), the cost is deducted immediately from your airtime, just like when you make a call or send a text.
This billing model is a shift from the old model where telcos billed the banks, a model that has caused serious debt issues over the years. The telecoms say this move could finally solve the USSD debt crisis, which hit ₦160 billion as of late 2024.
As per the Chairman of the Association of Licensed Telecoms Operators of Nigeria (ALTON), Gbenga Adebayo, telecoms and banks are already finalizing plans to switch to the end-user billing model, and both sectors are working on a smooth transition that won’t affect subscribers.
This move isn't exactly new, it’s been on the table since 2019. Gbenga cited that financial institutions have always wanted to shift the billing aspect to user to reduce the debt from their necks. “This is what the banks have wanted for a while,” he said, adding that the goal is to stop further debts from piling up.
Back then, banks kicked against sharing USSD revenue with telcos, especially after telcos proposed a cut of ₦4.50 per 20 seconds. Banks claimed this would drive up the cost by 450% and that pushback delayed everything. The fallout led to years of back-and-forth, leaving the debt issue to fester.
Back then, banks didn’t agree with the idea of sharing USSD money with telecom companies, especially when the telcos asked for ₦4.50 for every 20 seconds of use. The banks said this would make costs shoot up by 450%, so they refused—and that caused delays. Because of the disagreement, both sides kept going back and forth for years, and the debt problem was never properly sorted out.
As of now, telecom subscribers pay ₦6.98 for each USSD transaction — a fee implemented in 2021 — but even with that, the debt problems haven't been resolved. Some banks were disconnected from USSD services in the beginning of this year after failing to settle outstanding payments.
So when the crisis escalated, regulators have to step in, and telecoms managed to recover a good chunk of the money from banks. Meanwhile, some banks have not complied yet. In fact, CBN and and the Nigerian Communications Commission (NCC) have directed both parties to agree on how the debt will be paid—either all at once or in instalments—by 2 July 2025. For invoices from before the API system, 60% must be paid as the final settlement.
In essence, the debts are the main reason telecoms and banks both agree to shift to user-end billing model, allowing telecom subscribers to pay for their USSD transaction fee using their airtime balance.
