No Bank Account to Pay for Digital Services? No Problem!

Virtually everywhere you look, the digital world is creating opportunities for communications service providers (CSPs) to make more money on content, and also, to find clever new ways for consumers to pay for it.


Particularly for younger generations who prefer to manage their finances through mobile devices than in front of a bank teller—the unglamorous notion of being able to take a payment in multiple ways is quickly becoming one of the most critical components of a CSPs digital strategy.


Smart phones are making it easier to pay for virtually everything, and innovative new payment options are making it easy to support micropayments faster, more reliably and with more security than ever before. This set of circumstances attracts consumers who are likely to not have a formal banking relationship, much less a recurring monthly cable or landline bill where it would be easy to post charges.


This group of consumers—called the unbanked—are growing significantly in numbers across the world. In fact, nearly one-third of the U.S. population—106 million people—are either underbanked or unbanked, according to the Federal Deposit Insurance Corporation (FDIC), but the lion’s share of unbanked adults are living in Africa, Asia, Latin America and the Middle East.


Regardless of whether or not a payment comes from a bank account, Juniper Research estimates digital content paid for via carrier billing will provide CSPs with more than $14 billion in revenues over the next five years. And the research suggests that growth will be fuelled by a dramatic rise in carrier billed payments made on devices such as tablets, consoles and smart TVs. And let’s be clear: this isn’t just pass-through revenue. Each one of those transactions represents a revenue share for the carrier from that digital content purchase.


But in order to seize these revenues, CSPs must meet three key desires of consumers:


When it comes to payment choices, consumers want you to think outside of the box.

Improving your billing capabilities will enable you to monetize transactions of younger and unbanked customers—while partnering with the hottest content providers at the same time.


These payment capabilities—what we collectively call an e-wallet—must allow consumers to store all of their payment methods. This includes gift cards, PayPal accounts, stored value accounts, brand specific or external loyalty schemes, coupons and even credit or debit cards all in one centralized location.


With this platform in place, carriers can use it to incentivize customers, such as creating customer loyalty through rewards programs and coupons based on the programs they use the most.


Statistics show that 60% of consumers who already make mobile payments would probably do so more often if they received instant coupons or rewards as a result. Using a mobile rewards program allows consumers to both receive and redeem their rewards using their smartphone during the transaction.


Payments must be immediate, secure and fully integrated.

It goes without saying in today’s digital world that security is everything. Transaction security via mobile devices have come a long way even in the past 12 months, and they will continue to evolve to thwart fraud. But security is just one critical piece of a larger puzzle.


To ensure seamless revenue recognition and customer experience, e-wallet platforms must integrate with existing key systems in the back-office in order to maximize efficiency, optimize revenues and provide transparency across all channels. Your e-wallet payments must be able to integrate with customer data, order management and revenue management systems to preserve a single view of the customer and their balances. This could include federated identity management across a number of disparate systems to provide the required level of security, and in some cases, use payment methods stored in different systems.


Quick and easy payments will differentiate you from the competition.

For the consumer, buying content from a preferred source while on-the-go is becoming the norm. Making it easy for customers to “grab their content and go” is a critical step that the e-wallet can facilitate. Whether sitting at the office and downloading content to watch on the train ride home or purchasing that “I just can’t resist” boost to get to the next level of a favorite game, e-wallets allow consumers to easily and swiftly complete a transaction using their own preferred payment method.


Think of how easy it is to purchase something with one click, from a song, to a movie or even retail merchandise. For the service provider offering e-wallet capabilities, ease of payment plays a surprisingly big part of the loyalty equation. The faster and easier it is for a consumer to put a charge on whichever tab they chose—the monthly bill, a gift card or something else altogether, the stickier the relationship becomes.


With the rising number of adults willing to use options outside of traditional banks to make and finance purchases, payments simply shouldn’t be an afterthought but an integral part of the customer experience.


Digital commerce may start with the personalized promotion that hooks the customer and offers the storefront that presents the products. But closing the sale in an equally personalized and convenient matter is just as essential to securing customer loyalty.