By Maymunah Abdulwahab

Recent core banking upgrades across Nigerian Deposit Money Banks (DMBs) have sparked operational disruptions, leaving customers frustrated and unable to complete basic transactions. Despite reassurances, prolonged IT glitches have hindered account access, disrupted transfers, and eroded customer trust.

Given the centrality of core banking systems to bank operations, these disruptions underscore a need for effective strategies to reduce service interruptions during important transitions. Banking systems manage fundamental operations, from account balances to transactions, making them the backbone of financial institutions.

With rapid advancements in digital finance, Nigerian banks have embarked on system migrations to enhance efficiency, integrate new technologies, and strengthen security. However, upgrading these systems can be challenging and risky, as evidenced by the issues currently impacting customers.

Many banks have faced extended disruptions, affecting everything from daily customer transactions to business operations. For smaller enterprises, which rely heavily on dependable banking systems, even minor interruptions can have significant economic impacts.

To minimize customer disruption, banks could implement a staged migration.

Rather than transitioning all data and operations at once, banks can upgrade their systems in phases—starting with non-critical operations and gradually moving to critical ones. This approach would reduce the likelihood of complete service outages and give bank staff time to adapt to the new system progressively.

Banks could also divide their customer base by region or account type, implementing upgrades in cycles. This would limit downtime to a subset of customers at any one time, reducing operational load. Performing upgrades during off-peak hours, such as from 10 p.m. to 6 a.m., when transaction volumes are lower, could minimize disruptions to daytime operations.

Clear communication is essential here; banks must inform customers of expected downtimes in advance, using channels such as email, SMS, or app notifications, so they can plan around potential service outages. Customer support is crucial during system upgrades. Banks should reinforce their customer service departments to provide faster response times and robust troubleshooting.

Proactive updates through mobile apps, social media, and customer hotlines can keep customers informed about service status and any disruptions. Additionally, banks could offer alternative service channels, such as ATMs, mobile, and SMS-based transactions, to ensure access to critical services even if core systems are temporarily down.

Banks could enhance system resilience by deploying failover mechanisms and secondary systems to take over in case of primary system failures. This approach helps maintain continuity during upgrades, enabling essential transactions like fund transfers and balance checks to proceed without interruption.

Additionally, cloud-based storage solutions for critical banking data provide backup, reducing the risk of data loss during transitions. FinTech companies, such as OPay and PalmPay, have gained traction in Nigeria, especially when banks face technical issues. Banks could establish partnerships with these providers to offer temporary support for transactions during upgrade periods.

Customers could be directed to use these platforms for certain types of transactions, with the bank compensating any additional fees. Such partnerships would not only provide temporary relief during downtimes but also foster long-term innovation and service delivery improvements.

Core banking upgrades are essential for keeping pace with evolving technology and enhancing customer service. By adopting a phased approach, scheduling after-hours upgrades, and strengthening customer support, banks can better manage these transitions and minimize disruptions for customers.

Maymunah U. Abdulwahab is an intern at PRNigeria and a student of Ahmadu Bello University, Zaria. She can be reached via maymunahu92@gmail.com.

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TECH DIGEST – The Chairman of the Association of Licensed Telecom Operators of Nigeria (ALTON), Engr. Gbenga Adebayo today disclosed that the N42 billion indebtedness to Mobile Network Operators (MNOs) by Deposit Money Banks (DMBs) over the Unstructured Supplementary Service Data (USSD) has not been forgiven or wished away.

Engr. Adebayo, who was speaking on Arise TV, rather said the issue of the 42.2 billion indebtedness will be sorted out by both the Mobile Network Operators (MNOs) by Deposit Money Banks (DMBs), stressing that what is more important is the resolution of the protracted dispute by suggesting ways forward.

“What is important at this time is the way forward. The way forward is that telecom consumers will henceforth pay a flat fee of N6.98k per transaction, which has been agreed by both parties,” he said on the TV program monitored by our reporter.

While assuring that ALTON as an umbrella body of all licensed telcos in Nigeria is interested in promoting cheaper, seamless access to mobile and financial services for all Nigerians, Engr. Adebayo noted that the USSD channel is optional, as several alternative channels such as mobile apps, internet banking and ATMs may be used for financial transactions.

Deposit Money Banks (DMBs) were reported to be owing Mobile Network Operators (MNOs) a whopping debt of over Forty-Two Billion (N42B) Naira on Unstructured Supplementary Service Data (USSD) services, rendered by the telcos.

This led to a threat by the telcos to disconnect the service from the banks. But in a stakeholders’ meeting, which was chaired by the Minister of Communications and Digital Economy, Dr. Isa Pantami and attended by the various MNOs, Association of Licensed Telecommunications Operators of Nigeria (ALTON), Association of Telecommunications Companies of Nigeria (ATCON), DMBs (represented by the Chairman, Body of Bank CEOs) and the sector regulators – Central Bank of Nigeria (CBN) and Nigerian Communications Commission (NCC), the stakeholders resolved that effective March 16, 2021, USSD services for financial transactions conducted at DMBs and all CBN – licensed institutions will be charged at a flat fee of N6.98k per transaction.

This replaces the current per session billing structure, ensuring a much cheaper average cost for customers to enhance financial inclusion. The stakeholders believe that this approach is transparent and will ensure the amount remains the same, regardless of the number of sessions per transaction.

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TECH DIGEST – The Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) have introduced new charges for customers using the Unstructured Supplementary Service Data services (USSD).

A joint statement issued by the Financial and Telecommunications regulators said from Wednesday, March 16 customers will pay a flat fee of N6.98 per transaction every time they use USSD services.

The charges were part of the agreements after banks and telecommunication operators met on Monday to discuss the N42bn debt owed mobile operators by banks.

Mobile Network Operators (MNOs) and Deposit Money Banks (DMBs) have had protracted disagreements concerning the appropriate USSD pricing model for financial transactions.

This resulted in the accumulation of outstanding fees for USSD services rendered leading to threat of service withdrawal by the MNOs.

USSD is a critical channel for delivering financial services, particularly for the underserved and/or financially excluded.

To resolve the lingering dispute and ensure uninterrupted services to customers on this channel, the Minister for Communications and Digital Economy on March 15, 2021 chaired a meeting of key stakeholders to discuss an amicable resolution in the interest of the general public. Represented at the meeting were the various MNOs, Association of Licensed Telecommunications Operators of Nigeria (ALTON), Association of Telecommunications Companies of Nigeria (ATCON), DMBs (represented by the Chairman, Body of Bank CEOs) and the sector regulators – Central Bank of Nigeria (CBN) and Nigerian Communications Commission (NCC).

The statement was jointly signed by the apex bank’s Acting Director, Corporate Communications, Osita Nwanisobi; and Director, Public Affairs, Nigerian Communications Commission, Ikechukwu Adinde,

“We are pleased to announce that after comprehensive deliberations on the key issues, a resolution framework acceptable to all parties was agreed thus:

“Effective March 16, 2021, USSD services for financial transactions conducted at DMBs and all CBN licensed institutions will be charged at a flat fee of N6.98k per transaction.

“This replaces the current per session billing structure, ensuring a much cheaper average cost for customers to enhance financial inclusion.

“This approach is transparent and will ensure the amount remains the same, regardless of the number of sessions per transaction.

“To promote transparency in its administration, the new USSD charges will be collected on behalf of MNOs directly from customers’ bank accounts.

“Banks shall not impose additional charges on customers for use of the USSD channel.

“A settlement plan for outstanding payments incurred for USSD services, previously rendered by the MNOs, is being worked out by all parties in a bid to ensure that the matter is fully resolved.

“MNOs and DMBs shall discuss and agree on the operational modalities for the implementation of the new USSD pricing framework, including sharing of Application Programme Interface (APIs) to enable seamless, direct and transparent customer billing.

“DMBs and MNOs are committed to engaging further on strategies to lower cost and enhance access to financial services.

“With the above resolutions, the impending suspension of DMBs from the USSD channel is hereby vacated. Therefore, DMBs shall no longer be disconnected from the USSD channel.

“The general public is reminded that the USSD channel is optional, as several alternative channels may such as mobile apps, internet banking and ATMs may be used for financial transactions.

“The CBN and NCC shall continue to engage relevant operators and stakeholders to promote cheaper, seamless access to mobile and financial services for all Nigerians”.

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