Direct carrier billing presents a new ticket payment method for bus users. Supplier, Debit My Mobile, explains some of the benefits
Direct carrier billing (DCB) is a mobile payment method where third-party transactions are charged to the customer’s mobile phone bill. It leverages the trusted relationship between the customer and their phone carrier to create a secure alternative payment option for a variety of digital content.
Until recently, bus tickets were not counted among the digital content available through DCB in the UK. But a revision to the Payment Services Directive (PSD2) that came into force in 2018 has meant DCB now presents a viable payment solution within the transport sector.
Debit My Mobile, a company founded by tech investor Gary Corbett, is helping to pioneer the move to DCB as an option for operators in the UK. Already in use with parking companies, the supplier’s Charge to Phone Bill solution is now making traction in the bus industry. routeone finds out why DCB can present a secure alternative to debit or credit cards, and provide travel options for more passengers while reducing dwell time at stops.
A new solution
According to Debit My Mobile, there has long been an argument that DCB fits well as a digital solution in the transport industry. Much of the effort by the supplier in recent months has been to get people to understand the concept and see its value in implementation. “We wanted to create something bespoke for the ticketing, transport, and parking sectors,” says Head of Business Development Victoria Hull. “It’s a complementary proposition we need people to first understand, then add to their payment facilities.”
With the Charge to Phone Bill solution, a customer texts a code (for example, FARE) to a phone number arranged through Debit My Mobile. That code sends a charge to the user’s phone bill and, in return, they receive a unique reference or a link to a QR code which can be downloaded and used to board. DCB can be implemented in apps and vending, where customers are presented the option to input their phone number in order to pay, and are sent a one-time password to enter, confirming they are happy to buy a ticket.
For multiple ticket types, a unique QR code can correspond to each. Codes are arranged through the integration of ticket machines and their suppliers and can be advertised in places like bus stops or online.
Debit My Mobile says the solution is ideal for operators looking to reduce cash sales while being inclusive to those who are unbanked or prefer not to use a card. It is also a good option for bus users who do not wish to download an app; and for those operators that have flat fares, park and ride services, regular new or infrequent users on their services.
The one caveat to the system is that, in order so satisfy PSD2 rules, there is a charge limit of £40 per transaction, and £240 per month.
A sensible solution?
Debit My Mobile Business Development Manager Mark Ellis reveals that phone bill ticketing payments already work well in a number of European countries, including with De Lijn in Belgium, where 54% of ticket sales are completed with charges going to customers’ mobile phone bills. Much of that comes down to a legacy of mobile ticket purchases, which were in place before contactless payments became widespread.
As well as filling the gap for those who do not have access to card payments or who do not wish to use them, DCB can prove an attractive option for passengers seeking anonymity in an age of mass surveillance, and parents of children using bus services can also be comforted knowing there is no risk of a misuse of any details that come associated with uploading travel passes.
“While the number of the unbanked in the UK isn’t huge, there are still quite a lot of them, and they’re probably more likely to use the bus than other demographics who use a card,” explains Mark. “There are also quite a number or people who don’t want to give over their details in apps. It’s an easy way to buy a ticket and be relatively anonymous.”
Charge to Phone Bill also presents an advantage from a fraud perspective. Operators can rest assured knowing that the risk of fraud is removed as payments fail if the phone user does not have enough credit, while mobile phone carriers’ bad debt doesn’t incur chargebacks, as is the case with card payments.
Another advantage for operators is that, by allowing passengers to buy tickets through a text to their phone carrier, it allows tickets to be purchased in advance, reducing cash collecting, potential stress associated with having to buy a ticket on a bus, and dwell times at stops. There is no need for a smart phone, and network coverage can be as low as 2G in order for it to function. Debit My Mobile connects into the major UK mobile carriers, regularly has meetings with those carriers, and reveals they have long been championing DCB as a payment method.
At the moment, Debit My Mobile says there is no timeline as to when the solution will debut in the UK, though it says integrating with smaller, independent operators should be a quick process. Building a solution would require integration with the operator’s ticket machine supplier, and speed of rollout depends on the type of machine and the operator’s schedule and availability, as well as the speed of other stakeholders involved in any setup process.
“In reality it shouldn’t take long,” Mark says. “From talking to our tech guys, it doesn’t take much to set the integration up – it’s more about the physical time of a person sitting down and testing that it works.”
Victoria, meanwhile, reveals that integration with one parking supplier took a mere two days.
A step towards cashless?
The latest step in the journey towards DCB has been to encourage lower commission rates of the mobile network operators. That has historically been higher than credit card transactions. Now, the commission rates have reduced to be at parity with the cost of cash transactions. Mark says this step is significant in providing a choice for operators that are looking to reduce cash further.
“I think many operators would prefer to reduce cash to next to nothing,” adds Mark, though believes that cashless is still a “long way off”.
However, Victoria acknowledges that such a step “makes it a little bit easier for an operator to be brave and become the first to go fully cashless. I still think that’s a long way off too – but we can already see it happening within other industries, such as parking.”