New York, New York (NetworkNewsWire) – According to a recent
report in Android Headlines1, the long-awaited
alliance between Google and India’s largest mobile carrier, Bharti
Airtel, to offer Direct Carrier Billing (DCB) has finally come to
pass. On the table since at least 2014, the deal would give
Airtel’s nearly 40 million data subscribers the ability to purchase
apps and digital content from the Google Play Store without having
to submit banking information. This collaboration shows that DCB
has come into its own. It won’t be long before Apple, Inc.
(AAPL), First Data Corp (FDC), Square, Inc. (SQ), PayPal, Inc.
(PYPL), Net Element (NETE) and other DCB outfits find they
are on the right bandwagon.
Google has inked a similar deal for the Indian market with
British carrier Vodafone, suggesting DCB is on the cusp of rapid
widespread acceptance. It’s worth noting that the payment trend is
taking root among smaller players, as well as industry behemoths
like Google. One such example is global technology company
Net Element
(NETE).
Ranked as one of South Florida Business Journal’s Top 25
Fastest-Growing Technology Companies, Net Element specializes in
mobile payments and value-added transactional services. The company
has oriented itself for growth in emerging economies and the U.S.,
actively seeking opportunities to transform the online and mobile
experience with a multi-channel platform, simplified security and
compliance, essentially providing an all-in-one digital
solution.
Aligned with this growth strategy, Net Element offers DCB
through its Digital Provider subsidiary. As one of several
companies under the Net Element brand, Digital Provider works with
the largest mobile operators in the Commonwealth of Independent
States (CIS), as well as select emerging markets, to offer content
providers, social media networks, game developers and other
merchants a broad array of payment options, including DCB.
What Net Element has discovered is consumer appeal of DCB -
which is that it gives a mobile subscriber the convenient ability
to purchase content such as apps, games and music and, rather than
make a separate transaction, have the charge put on his or her
telephone bill.
Unlike making purchases with debit and credit cards, DCB does
not require banking information. With DCB, a mobile provider
supplies the third-party provider with just enough details to
enable shipment of the content. The mobile provider pays the third
party for the content and then sends the customer the bill at the
end of the month.
It’s no accident that Google has chosen to expand its
partnerships in India, where mobile phones far outstrip bank
accounts. According to a global market report by Fortumo, called
Direct Carrier Billing in 2016, Asia Pacific is set to
overtake Latin America as the region with the largest transaction
volume in carrier billing in 2017.
DCB volume in India grew by 175 percent in 2016 with a potential
for further triple-digit expansion. With a population of 1.3
billion, the country has an estimated one billion mobile phone
subscribers. However, smartphone penetration is just 20 percent. As
Indians replace their old mobiles with smartphones, DCB is likely
to become a major payment method.
The Fortumo report also highlights the Philippines and
Australia, which together with India are the countries with the top
growth markets in the Asia Pacific region.
At present, mobile phone billing, as the folks at Apple (AAPL)
call DCB, is available to customers of its iTunes Store, App Store
and iBooks Store who live in Belgium, Germany, Japan, Norway,
Russia, Saudi Arabia, Switzerland, Taiwan and the United Arab
Emirates. It’s worth noting that the United States isn’t on the
list.
For the most part, Net Element is among the first businesses in
the United States to offer DCB services, though companies like
First Data Corp. could awaken to the opportunity and follow
suit.
First Data (FDC) is a global payment technology company best
known for its STAR inter-bank network. The company reportedly
handles 45% of all U.S. credit and debit card transactions, but
expansion there has been slow. First Data (FDC) is scheduled to
release its fourth-quarter results before the market opens on
February 13.
San Francisco-based Square, Inc. (SQ) - creator of the Square
Reader that attaches to mobile phones and allows consumers to use
debit and credit cards, as well as the Square Register
point-of-sale software that can be used in lieu of traditional card
terminals and cash registers – is also evolving the broader digital
payment landscape. The company recently announced (http://nnw.fm/lMw7q) “a limited-time program that will
allow small businesses to process more than $12,000 in Apple Pay
payments for free (a $350 value) as an incentive for them to
encourage their customers to use the payment method.”
PayPal (PYPL) is also moving the scale toward DCB in the United
States. Back in 2012 at the Mobile World Congress in Barcelona, the
company announced its plans to work with carriers and digital
merchants to expand carrier payments. Today the company offers its
Tele2 product, enabling subscribers to “top-up” their PayPal
balances through their mobile phone bills – meaning the users can
transfer money from their bank accounts into their PayPal (PYPL)
accounts.
Fortumo forecasts that, while Latin America boasts the biggest
transaction volume for carrier billing, Asia Pacific is likely to
take the leading spot in 2017. Perhaps one snag for DCB in the
United States is consumer concern over data security. However, as
an increasing number of consumers abroad take advantage of the
conveniences of DCB, the market on American soil is ripe for
companies like Net Element (NETE) to take a leading start.
1 Android Headlines: http://nnw.fm/V4c1V
For more information on Net Element (NASDAQ: NETE) visit:
www.netelement.com
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