Who needs a bank account when you’ve got Direct Carrier Billing?
Do you remember the promise that we would be able to pay for everything just using our smartphones? Well, now you can. OK, some of us have been able to do it for a while, says Peter Dykes, but the enabling technology, Direct Carrier Billing (DCB) is gaining traction across the globe as an increasing number of operators rolled it out in 2017. And it’s easy to see why.
By far the most popular way of paying for goods and services via a mobile phone has been Premium SMS (PSMS). This usually involves a two-stage log in, a charge to the customer for the texts and often, having to input card details when buying online, which is not the easiest thing to do on a seven by five centimetre, screen-based keypad.
Services such as PayPal and the myriad of others which offer similar functionality, while not revealing card details to the vendor, still have to be logged into whether it’s from a PC or a smartphone, with the receipt appearing somewhere in the customer’s inbox only to get lost in a deluge of marketing emails. How much easier then to just pay directly through the carrier and have a record of all online purchases in one place, much as customers already do when buying from AppStore or Google Store?
Indeed, DCB has distinct advantages for the communication service provider (CSP) too. For instance; it means operators can apply flexible charging plans, customer care becomes more effective and, perhaps most importantly, DCB offers very low revenue leakage. Being especially useful for making quick payments, it’s likely that customers will prefer it to having to fill out lengthy forms and hence make more purchases, thereby earning more revenues for the CSP.
Who’s doing it?
So, who’s been rolling out DCB in 2017? The list includes some big hitters in telecoms as they extend DCB to some of their satellites. Telenor, for instance, launched DCB with Estonia-based vendor Fortumo in Serbia and extended its contract with the same vendor in Myanmar. Others include Finnish operator Elisa and A1 Telekom Austria. Orange, too, has been busy over the last 18 months with a couple of DCB roll-outs, first in Poland and latterly in Egypt, both of which also used Fortumo’s platform.
The rationale for deploying DCB is pretty clear, as expressed by Łukasz Perzyński, head of E-Payments division at Orange Polska. He said at the time of the launch, “Direct carrier billing eliminates all the imperfections that concern Premium SMS both for our subscribers and to merchants by providing a convenient, quick and secure method of payment. I deeply believe that in the nearest future we will have a lot of services based on direct carrier billing in Poland”.
And for the unbanked?
One of the statistics that is regularly rolled out when discussing DCB is that there are almost three billion smartphones in the world right now. While direct carrier billing is already live in Germany, Japan, the United Kingdom, and the U.S., not everyone in the world who has a phone has a credit card or even a bank account, not by a long way.
Therein lies the biggest potential market for DCB. Many of those rollouts mentioned above are in low income per capita economies but there will be more to come, particularly in the developing markets of South East Asia, India and South and Central America. After all, if you’ve got a smartphone, who needs a bank account?
By Peter Dykes, freelance telecoms writer