USSD Refuses to Die, and the Apps Trying to Replace It Keep Losing

It is 1990s technology, it looks terrible, and across most of West Africa it still moves more transactions than every banking app combined. USSD — the numeric menu you reach by dialing a short code — accounted for 61% of retail banking transactions in a five-country sample compiled by the payments consultancy Ndolo Advisory this year.

Banks have not been passive about this. Several have run multi-year campaigns pushing customers to apps, including fee differentials that make USSD explicitly more expensive. Migration has been slower than every projection. The reasons are unglamorous: USSD works on any handset, consumes no data, requires no update, and survives a network that an app's TLS handshake will not.

"My mother has a smartphone and she uses the code," said Ndolo analyst Aminata Sow. "I asked her why. She said the app makes her log in, and sometimes it does not open, and the code always works. That is the whole analysis. I could have saved us the study."

The strategic implication is that the interface layer for African financial services is not converging on the smartphone as quickly as product roadmaps assume. Institutions that have quietly kept investing in their USSD trees — better menus, fewer levels, session timeouts that account for slow typing — are outperforming those that treated the channel as legacy and stopped touching it.