Direct Carrier Billing: Enabling MNOs to Tap into New Revenue Sources

Posted by reallynicearticle on December 13th, 2020

Many modern consumers value one thing above all else – convenience. People spend more time and energy on the Internet than ever before. Almost everything we want can be accessed and purchased with just a few taps on our smartphone screens. Delivering this kind of front-end experience requires a highly-organized back-end operation, which often entails a massive network infrastructure and several third-party integrations.Direct carrier billing

In an online environment where more and more digital services crowd the market, simplicity has become the name of the game to win over consumers. For the digital value chain, mobile network operators (MNOs) have pegged the billing and payment mechanism as a key consumer touchpoint and leveraging Direct Carrier Billing (DCB) as one of the fastest ways to achieve front-end scale and convenience.

Let’s examine the reasons why DCB is an innovative solution for MNOs and digital service providers to better sync their operations and obtain increased economies of scale.    

Creating Beneficial Partnerships by Streamlining Payments

For MNOs searching for new revenue sources, DCB opens the door of opportunity as one of the strongest, stickiest, and most versatile payment channels. Since most consumers only subscribe to one MNO at a time, DCB enables MNOs to directly participate in the over-the-top (OTT) market – which includes media, mobile games, and apps – by providing a single payment channel for digital service providers to reach paying customers.

This also means that rather than competing with OTT players, mobile operators can leverage DCB to create convenient and complementing business relationships. The advantage of knowing their consumers’ buying patterns and spending habits, along with existing billing relationships and established distribution channels, allows MNOs to derive greater value than any OTT player. Access to this kind of knowledge can enhance revenue by enabling beneficial partnerships in the digital and e-commerce value chain.

Reaching Broader Markets and the Underbanked

The benefits of convenience and integrated service offerings cannot be understated. Another vital way that DCB supports a lucrative venture for MNOs is that it targets a massive, undeserved consumer segment: the underbanked. In developing markets where the population does not have access to traditional banking facilities, a large proportion of subscribers do not even have credit/debit cards, which means DCB can be made available as a viable payment method.

Even in most of the developing world, people own smartphones and use prepaid cash top-ups to settle their mobile phone bills. DCB allows these mobile subscribers to access paid digital services using a payment method they are already familiar with. Providing a wide variety of digital content at relatively inexpensive costs with a secure and easy payment option will increase the likelihood of customer retention in these markets.

DCB eliminates the need for consumers to fill out additional personal information, which may have been needed for a typical credit/debit card purchase. This reduction in authentication steps leads to higher conversion rates as customers become less likely to drop out of a purchase midway to fill up information.

The Optimal Option for Versatile Digital Payments

By leveraging the strength of the MNO payment channel, direct carrier billing is an attractive method of payment when targeted towards active mobile subscribers, especially for a significant proportion of both adult and youth outside the traditional electronic payment system. Combining the ability to access the underbanked and establish stickier consumer habits through a streamlined channel, companies looking to expand and scale their business quickly would see DCB as the optimal option for versatile payments.

For DCB to be deployed fast, mobile operators can work with experienced system integrators who can create the right platform with the right configurations, while leveraging the capabilities of the existing IT ecosystem for billing, CRM, and revenue management. The services these integrators can provide to MNOs and digital service providers can enable both these parties to achieve scale easily.