By Stefan Kostic, CEO at Centili
Mobile payment technology has never been in greater demand. From sophisticated banking payment flows designed to streamline the customer journey in established markets, to clever mobile-only technologies acting as the primary form of paying for physical and virtual goods in others, a variety of different methods and payment mediums are now available around the world. It’s quick, easy, and in most cases much more convenient than using cash. And when you consider that there’s now more than 4.8 billion individuals using mobile phones globally according to Forrester Research, it’s no surprise that mobile payments have seen such universal success.
However, most of these technologies don’t cross the divide between developed and developing nations. Apple Pay, for example, is largely restricted to the western world where credit cards are the norm. As a comparison, in Nigeria almost half of customers purchase content and other goods and services through their mobile operator. It’s primarily a question of localisation, which has been a barrier to the international roll out of any single payment technology. Carrier Billing, however, has broken the mold and become an important driver in helping to communicate the wider benefits of mobile payments to the masses.
Who needs carrier billing?
As a concept, Carrier Billing has been around for a while and it’s got a large user base in developing regions. Part of its success is due to how this technology doesn’t require a credit card or bank account. Users can make payments purely with their mobile phone. It also simplifies the payment process. A transaction can be made in seconds through a single click, making Carrier Billing a quick and easy alternative to cash – and, for developing regions, a lifeline for consumers where other payment technologies are either not available or haven’t seen the same widespread penetration.
Elsewhere, in the western world, Carrier Billing is also being used for a variety of purchases. It’s the system that lets you add the cost of your Spotify subscription onto your monthly contract, for example. Or to make in-app purchases using pre-paid credit. There’s evidently a lot of value in this type of payment method for consumers, especially as the technology has advanced in recent past years to run on practically any internet-enabled device, whether it’s mobile or desktop.
Businesses, too, see huge benefits. In fact, statistics show that where Carrier Billing is available, conversion rates rise by up to 85 per cent. This is because consumers experience a much more fluid and user-friendly experience, especially when it comes to enhancing mobile services through in-app purchases or purchases made on mobile browsers. Yet that’s only scratching the surface of what’s possible with Carrier Billing. There’s much greater potential ahead, both for businesses that deploy it and mobile operators acting as the delivery mechanism for this technology.
The new business opportunities
Carrier Billing can streamline payment flows and sales conversions for a wide variety of industries. The insurance and ticketing industries are two notable examples.
Consider a situation where an insurance company sells a policy to a new customer. Whether the customer is living in a developing or developed country, the challenge in getting that deal over the finishing line is the same – documents typically need to be sent in the post and returned in order to start the payment process. It’s a problem from the very start and in an unbanked region it’s even more difficult. Without a bank account to take a direct debit from, the deal may be dead before it’s even begun.
Carrier Billing can address this issue by sending a notification via SMS immediately after the salesman has finished the call, giving the potential customer instructions on how to start their policy and having the payments debited from their phone bill. Carrier Billing technology has already started to address these types of issues for businesses that made a lot of their sales over the phone. However, the same applies to any industry that stands to improve its conversion rate by getting customers onboard while they are still ‘hot.’
The same applies to ticketing, which is another notable example of where carrier billing can be used to modernise a traditional service. Here, similar to insurance, a sale can be made immediately and the payment process streamlined, particularly when you consider that the average consumer discovers products and services on a mobile device in the first instance.
For businesses looking to introduce this technology, of course, there are considerations to be made. In order to see the full value of Carrier Billing they need to partner with a payments provider that has a global footprint but local expertise. That chosen partner must have connectivity and m-payments flows with operators around the world, and have an understanding of the nuances between different business segments for both one-time and recurring payments.
International reach is also incredibly important for a service like this, reducing complexity for businesses looking to take advantage of Carrier Billing and improving the overall user experience.From a mobile operator perspective, therefore, they need a platform that’s easy to integrate with existing systems and infrastructure to reduce time to market and lower OPEX.
How Carrier Billing is deployed in different markets and for different business use cases will ultimately depend on the needs and individual use cases of each country. What works in one region won’t necessarily work in another, which has been seen with a variety of mobile payments technologies time and time again.The right approach, however, paired with the right partner, will provide the optimal combination of availability, monetisation, and promotion to make the most of any given market.