Divisional Head of Financial Industry Partnerships, Remita, Lanre Idowu, cautioned that escalating Unstructured Supplementary Service Data (USSD) transaction charges risk undermining one of Nigeria’s most effective tools for financial inclusion.

Speaking at the Nigeria Information Technology Reporters Association (NITRA) conference in Lagos, Idowu noted that while USSD banking was introduced to extend financial services to Nigerians without smartphones or Internet access, rising costs could discourage adoption among low income users and stall progress in bridging the digital divide.

Checks by The Guardian showed that USSD transactions in Nigeria currently attract a flat fee of about N6.98 per session, shared between banks and telecom operators under a new “pay as you go” billing model introduced in 2026. While this has stabilised the ecosystem after years of debt disputes, affordability concerns remain for low income users who rely on USSD as their primary access to financial services.

Customers are debited directly when initiating USSD transactions (such as transfers, airtime purchase and bill payments).

Idowu explained that USSD remains a lifeline for millions in underserved communities, enabling access to payments, transfers, and banking services without the need for broadband or smart devices. However, he warned that if charges continue to climb, the very populations USSD was designed to serve could be excluded.

“The country’s digital divide should be viewed as an opportunity divide,” he said, stressing that affordability, trust, and accessibility must be prioritised to ensure inclusive digital transformation.

He urged regulators, telecom operators, and financial institutions to harmonise policies and rethink pricing models so USSD can remain a reliable, low cost gateway to financial services for all Nigerians.

Idowu called for increased investment in digital infrastructure, cybersecurity and financial inclusion.

According to Idowu, despite projections that Nigeria’s digital economy could reach $18.3 billion by the end of the year, millions of Nigerians remain excluded from the opportunities it offers due to inadequate connectivity, affordability challenges and limited digital access.

He described Nigeria’s digital transformation as “two Nigerias,” one recognised globally for innovation and another still constrained by poor broadband infrastructure and unequal access to digital services.

Idowu noted that Nigeria has built one of Africa’s fastest-growing fintech ecosystems, with instant payments becoming the standard for individuals, businesses and governments, while local technology startups continue to earn global recognition.

However, he said broadband penetration remains uneven, internet access is still limited in many underserved communities and the rising cost of digital connectivity continues to widen the inclusion gap.