Starting in June, a new guideline by the Nigerian Communications Commission will charge mobile airtime instead of bank accounts to customers for Unstructured supplementary service data (USSD) sessions. This is the latest development in the long-running dispute between telecom operators, banks and customers over who should pay for USSD transactions. Unpaid fees of N160 billion (106.67 millions) are still pending.
According to the new billing model, which was first hinted at by a customer notice from Sterling Bank and United Bank for Africa on June 3, 2025 (UBA), each USSD session costs N6.98 for 120 seconds. Telecom operators will deduct the amount directly from a subscriber’s airtime after they have received the user’s consent and the bank has confirmed that it is prepared to provide the requested service.
Although the NCC has not yet released a public statement, sources familiar with ongoing discussions confirm that the final implementation details are currently being worked out by banks and telcos. Implementation is likely to begin before the end June. The commission declined to comment, but an NCC official stated that the commission was preparing its detailed position on the new regulations.
A longstanding dispute is finally resolved
This new model is designed to break the cycle that has plagued USSD service since its inception. Initially, telcos provided USSD infrastructure to the banks, which in turn billed their customers and were required to settle service fees with them. There was no clearly defined revenue sharing model. As user adoption increased, so did the debt that banks owed to telcos.
MTN Nigeria tried to shift the costs to subscribers in 2019 by introducing a model of end-user billing. The Central Bank of Nigeria and the NCC quickly stopped the move, arguing USSD was not intended to be charged directly to end users. In 2020, the NCC adopted a corporate-billing model that instructed banks to pay for service costs and collect transaction fees separately from customers.
Despite attempts to standardise USSD charging, disputes between telecom operators and banks persisted. In 2021, the banks were expected to collect a flat fee per USSD session of N6.98 and pay it to telecoms. But compliance remained low.
Unpaid fees accumulated over time and, before regulatory intervention, the telecom operators claimed banks owed them N250 billion in USSD services. CBN and NCC responded by ordering banks to pay N212.5 billion (85% of total debt) by the end 2024. The debt had steadily increased over the past few years due to late payments and unresolved bill models. MTN reported that it had recovered N32bn by early 2025 but still had N42bn outstanding. What are the changes to direct airtime billing in 19659009?
With safeguards in place, the NCC directive returns to end-user billing. Users will no longer be able to silently pass fees through bank channels. Instead, they will have to approve each transaction. The N6.98 will be deducted directly from the user’s airtime balance once consent is granted. This gives telecoms complete control over fee collection.
The shift to direct billing of airtime is a long overdue solution for telecom operators. It offers multiple operational benefits. It eliminates the necessity to pursue banks for settlements and reduces bad debts as payments are collected immediately at the point-of-transaction. It also gives telcos complete control over USSD billing, revenue tracking and streamlines operations by removing legal and administrative burdens of dealing with unpaid bank debts. What does this mean for customers
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The new USSD billing model has the biggest impact on subscribers. They must have enough airtime to initiate any transaction. This is a change from the previous system where charges were deducted from bank accounts. It may be inconvenient for those who are not used to topping up mobile credit. This could disrupt financial transactions for those who are used to seamless banking, without the need to monitor airtime balances.
The model does introduce certain benefits that may enhance the overall experience of the user. The introduction of a consent request before any charges are applied is a key improvement. This ensures users are aware of the charges and agree with them, leading to greater transparency and trust when it comes to how USSD services will be billed.
Standardised pricing – N6.98 for 120 seconds per session – provides predictability. Users can better manage their mobile banking costs with clear and consistent pricing. This may encourage users to use the service more often, especially in areas where internet-based banking is not available.
USSD is a vital channel in Nigeria for financial access, especially in rural areas and underserved regions where mobile apps and internet are less prevalent. The new model, by simplifying costs and improving reliability may increase confidence in USSD banking. It could also preserve its utility as an inclusion tool.
The NCC’s new regulations resolve one of the longest-running disputes in the telecom sector, but some questions remain. Will subscribers protest against airtime billing? How will banks adjust to a diminished role within the USSD transaction chain. Can this model be sustained on a market that is already struggling with inflation and rising costs?
Telcos such as MTN and Airtel will benefit in the short-term from increased revenue collection and a tighter grip on service delivery. The success of the policy will depend, however, on the user experience, public awareness, and the ability to maintain service affordability. Mark your calendars
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