You probably have network issues now and thinking of which another way to do a bank transfer. Well, we got you covered.
It is, indeed, the era of Transfer/USSD codes, which may eventually upturn the era of mobile apps bank transfer.
In 2008, Bill Buxton wrote an article where he described a concept known as “The Long Nose of Innovation.” The definition of that term and the premise of that article as he described it is – “The bulk of innovation behind the latest “wow” moment is low-amplitude and takes place over a long period—but well before the “new” idea has become generally known, fully refined, much less reached the tipping point where it becomes widely adopted”.
The fuss about USSD codes
USSD is an acronym for “Unstructured Supplementary Service Data.” It is a communications protocol used by GSM cellular telephones to communicate with the mobile network operator’s back-end platform. It is “session” based instead of “message” based; this means that it opens a short data transfer session where a transaction happens, or a message transmitted between the backend and the subscriber’s phone.
The USSD code is actually an interactive and menu-based technology that is supported on nearly all mobile phones.
Some of the practical service usages of the USSD codes are bank transfers, airtime top-ups, balance checking, as well as mini-statement deliveries – these days, banks, allow mini-loans to be gotten through a USSD code.
The USSD becomes a practical and fundamental service when offering a communication channel, it allows users the possibility of accessing confirmation and consultation services through dialling.
The format for the USSD code is usually defined by the * and the # signs, which are dialled at the beginning and the end of the series of digits before you press the send button. The user makes unique dialing initiated by (*) followed by a unique code, thus entering a menu of services offered by the bank.
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For Nigerians, the Transfer USSD code system provides a seamless method of doing transactions because there are far fewer dependencies for the consumer. You do not need an active data plan or even a smartphone.
In actual fact, USSD codes were introduced seeing the ultimate necessity for financial inclusion, especially considering people in the rural areas, who will also want to be part of it all.
The advantages of USSD code
This idea of the USSD code is to become a channel that complements a bank’s communications. It offers more alternatives to users, guaranteeing access to information. Indeed, the USSD code is the perfect complement to making the bank omnichannel.
While SMS is stored in the phone, USSD texts and interactions are not, making this option one of the safest if it is sensitive information.
According to CGAP, the USSD code is currently still the best communication technology available to provide medium-income and low-income individuals. In plain terms (from Strategix):
- USSD code works on all GSM mobile devices.
- USSD enables banks to play along financial inclusion lines.
- USSD doesn’t need any mobile app installation.
- USSD can integrate into any business system using a web service.
- USSD is free to use so your customers don’t have to pay a cent, which means they will be amenable to USSD services.
- You’ll save money as USSD doesn’t cost a lot to implement and use.
- USSD is a quick way to exchange data in real-time as it is session-based.
- USD’s menu-based applications enable more user interaction.
- USSD is easy and convenient to use.
- You do not need an internet connection as USSD works on voice connectivity.
- USSD doesn’t charge the customer for roaming.
- USSD is more secure than SMSs.
- USSD is faster than SMSs (up to seven times faster).
- USSD allows for messaging to take place during a call.
- USSD can easily be customised to suit your business needs.
- USSD allows you to increase revenue by making it easy for customers to recharge accounts and generate higher call volumes.
Concerns about USSD codes
In a 2018 article, Steers Business highlighted that USSD services may not be as safe as we envisage.
The article stated that, “each bank has a unique shortcode, but this is also backed by unique infrastructure. In fact, nearly all mobile financial service providers (banks, mobile money operators and payment service suppliers, etc.) operate unique applications in providing USSD services to customers. Therefore, it is possible that the risk exposure of USSD transactions increases because each financial service provider uses its own technology, meaning there is no universal standard for all channels.
“More importantly, messages over USSD channels are not encrypted, leaving them vulnerable to being hacked.”
It continues, “Thieves steal phones to gain access to sim cards, which are usually connected to some bank accounts. In some cases, once they figure out the bank an individual uses, they can generate the Bank Verification Number (BVN) and use the mobile USSD of the bank to wipe the account.”
Yet, USSD codes have done more saving than harm. This is more reason you need to know these codes. See below: