What is USSD? How does it Work?

The mandate of the new world seems pretty clear: the push is to automate processes and ultimately bring all the sectors as close to each other as possible.

With the age of the internet, communication has seen a significant bump. However, another breakthrough that can be associated with technology is that the digital world has not forgotten those people who find themselves on the wrong side of it.

The SMS was a breakthrough invention and a similar invention has been USSD. Almost all of us use it each day, sometimes to check our balance and other times to do a quick mobile recharge. But, what exactly is USSD and how does it work? In this article, we discuss all you want to know about USSD. Take a look:

What Is USSD?

To begin with, USSD is short for unstructured supplementary service data. It is a technology that has been devised for the sole purpose of financial inclusion of different people. Whenever you dial a number that begins with a ‘*’ and ends with a ‘#’ you’re dialing a USSD. To understand in brief what a USSD is, consider this: it is a protocol that is used by cell phones to communicate with the computers of their service provider. That is, when you dial a USSD, it initiates a communication between your phone and your SIM card company to resolve your queries for that particular USSD.

While the functioning of a USSD is quite technical, let’s try and break it down into simpler parts.

(Image Courtesy: Talk of Naija)

How Does USSD Work?

Like we discussed above, USSDs are protocols developed to facilitate communication between your phone and your service provider. Whenever you dial a USSD, say for instance *123#, the code is first sent to a cloud server. From there, the server communicates the input with the computers of the service provider which then initiates a response to the code.

Every service provider has fixed USSD codes that are preset to communicate particular messages. You might be wondering as to why USSDs were developed in the first place. Not everyone has a steady internet connection at all times. USSDs can communicate with the service provider when there is no internet connection and even when a user doesn’t have phone balance left in his/her account. People usually use USSD codes to check and often recharge their phone balance.

Needless to say, USSDs are a groundbreaking invention as they have several applications; applications that can be of benefit to people who can’t afford a smartphone or an internet connection. Let’s see how.

(Image Courtesy: Ycr)

Applications Of USSD

As discussed above, you can perform a host of activities using USSD codes at the flick of a hat. You can recharge your phone, check your balance, start or stop a particular service, and more importantly, make online payments!

Yes, with recent developments, it has become possible to see through cashless transactions using USSD codes. For instance, India government’s latest initiative, BHIM has made it possible for people in rural areas to establish themselves as an integral part of a cashless economy that India is pushing towards.

(Image Courtesy: USSD Gateway)

So, there you have it. If you found this article informative, let us know in the comments below.

(Featured Image Courtesy: Talk of Naija)