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The Significance of USSD in Emerging and First World Markets

In today’s world, where technology is advancing and accelerating at an alarming pace, some older technologies are still making a significant impact globally. One such technology is USSD. Over the last two and a half decades, this powerful, functional, and straightforward technology has provided consumers with an array of services across industries. Below we examine the significance of USSD in emerging and first world markets and how this technology is still being utilised.

Overview of USSD

USSD technology was first patented in 1994 and stands for “Unstructured Supplementary Service Data”. USSD is an interactive, menu-based technology that facilitates real-time interaction. A USSD message can be up to 182 characters long and is often confused with SMS technology as both are used to send short text-based messages. Unlike SMS messages, USSD messages create a real-time connection during a USSD session. The connection remains open, allowing a two-way exchange of a sequence of data. USSD technology is also more responsive than SMS.

In simple terms, USSD is a mobile communication technology used worldwide to send texts between a mobile phone and an application in the network. Consumers most commonly use USSD to check available mobile airtime, conduct data balance enquiries, for mobile banking services and more.

You may be asking what makes USSD so popular. The answer lies in the fact that this technology is easy to use, does not require sophisticated technology, and is cheaper than most communication platforms. USSD also has the following benefits:

  • Does not require an internet connection or mobile data to work.
  • Reduces operating costs when it works as a self-service application for your customers.
  • Enhanced customer satisfaction when you give them the ability to serve themselves.
  • It works with just about every mobile phone.
  • Works globally.
  • Intuitive menu with real-time interactivity.
  • Very economical. 
  • Two-way communication is up to seven times faster than SMS.

The power of this particular technology is based on the ability of this technology to be used across all mobile phone devices and networks – it is fully inclusive, which is why it is still being utilised in both emerging and first world markets.


Emerging Market vs First World Market Landscape

To understand why USSD is still an essential technology in today’s digital age, we need to examine connectivity and smartphone adoption in emerging and first world markets.

According to GSMA’s 2022 Mobile Economy Report, 53% of the global population are connected, which means they have used internet services on a mobile device, 41% are within the footprint of mobile broadband but do not use it, and 6% do not live within the footprint of a mobile broadband network. Although 53% of the population are connected, 47% per cent are not, which translates into 3.6 billion people who are not connected globally. This highlights a significant usage gap which seems to be growing. According to the report, the reasons for this usage gap vary by region, with emerging markets particularly struggling with this gap due to a lack of affordability, relevance, knowledge, skills, and safety and security concerns. It is important to note that 3.4 billion people globally are not using mobile internet despite living in areas where there is mobile broadband coverage.

In terms of the technology mix and network usage across the first world and emerging markets currently, this is what we are seeing:

Greater China1%1%69%29%
Asia Pacific18%16%64%2%
Latin America9%21%61%9%
Sub-Saharan Africa26%57%16%1%

From the above, it is clear that although 5G adoption is on the rise, this is generally only taking off in first-world markets, with emerging markets still heavily reliant on 2G, 3G and 4G. Even though smartphone adoption is also on the rise, several consumers globally do not have smartphones. For example, in Sub-Saharan Africa, only 48% of consumers have a smartphone, leaving over half the population with simpler and more outdated mobile devices that can often not support new and advanced technology. This is where USSD is so effective.

Since USSD does not require an internet connection to work it is a technology that is more accessible. It is also supported by most mobile phones without the need for processing hardware which is essential for smartphone platforms like Android and iOS. In this way, USSD enhances inclusivity and communication.

How are emerging markets utilising USSD?

From the above, it is clear that USSD still has a place in today’s tech stack, specifically for emerging markets.  These markets are utilising USSD applications for several different applications and services. One of the dominant services is large scale mobile financial services.

USSD is the primary mechanism for communication between customers and their mobile payment platforms in these markets, especially for unbanked and low-income consumers. Examples include M-Pesa in Kenya, bKash in Bangladesh, Wing in Cambodia, EasyPaisa in Pakistan and EcoCash in Zimbabwe.

In Africa specifically, USSD is being used to provide customers with several different socio-economic services that include insurance, healthcare, education, commerce and more. Examples of these, as stated in a GMSA report, include:

  • Casava (Nigeria): is a peer to peer (P2P) insurance platform that aims to use artificial intelligence (AI) to enable consumers to buy insurance where the customer makes small weekly and monthly insurance subscription payments via debit card or USSD.
  • Chalkboard Education (Ghana): The edtech start-up provides Africans with distance-learning university courses. The start-up offers an easy mobile learning solution that allows universities to upload teaching materials. Students can access these courses with or without an internet connection. Chalkboard Education addresses the issue of connectivity through USSD and SMS technology.
  • Kasha (Rwanda): The e-commerce start-up sells and delivers women’s healthcare and personal health products such as contraceptives and tampons. Customers can access Kasha via USSD, mobile and a web application. Customers using USSD can type in a shortcode to access Kasha’s menu and place orders.
  • GiftedMom (Cameroon): The start-up offers health information and monitoring services to pregnant women in marginalised communities through USSD, SMS and a web application.
  • Skyfox (Ghana): The social enterprise, which reduces service downtime, runs a project in rural Ghana. When a water hand pump breaks, someone in charge (usually a caretaker) can initiate a USSD session to send a report to a technology platform managed by SkyFox, which updates the facility’s status as “Not Working“. Simultaneously, information is sent to a set of mobile phones of individuals such as mechanics who can fix the water hand pump.

Telecommunications sectors within emerging markets are also utilising USSD to connect and engage with its customers, enhance the customer experience, and increase revenue and profitability. This is facilitated by allowing customers to make a balance enquiry, check balances, or top-up airtime or data and more. These kinds of USSD applications also enable a Telco to provide their subscriber base with:

  • Self-help services that are fast, accessible, and efficient to use.
  • A way to find out information related to their mobile subscription without needing an internet connection, data, or funds by allowing for two-way information communication.
  • A way to give customer feedback on queries.
  • Product or service information that would interest these customers 

Can USSD enable Growth in Emerging Markets vs First World Markets?

USSD offers emerging markets a way to participate in the economy and provide those without connectivity or smartphones access to essential services. It is important to note that even in first-world markets, where new technology adoption continues to grow at a fast pace, there is still a fair percentage of customers who do not have access to or cannot afford this kind of technology. USSD technology creates an opportunity across markets to reach all customer segments regardless of their network or what phone they have. This is where the power of USSD lies and why it is a technology that not only enables growth opportunities but also enhances inclusivity for all. 


There is no doubt that USSD remains an important, if not essential, technology across all markets. It is connecting consumers with businesses, opening up a variety of services to those who could not previously access these, and driving economic growth. Within emerging markets specifically, we have only just begun to see what is capable with USSD, which makes this an exciting space to watch.

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