Imagine you desperately need a soda, and right in front of you there is a vending machine filled with ice-cold soda bottles, yet you have no cash to buy one. Or you have a coin, but there is no slot on the vending machine to put the money in since it only accepts payment cards. In both cases, you have the will, but you lack the means to conclude the transaction. Both scenarios are examples of what happens when there is no “financial inclusion”.
What is “financial inclusion”? The World Bank describes it as follows: “Financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit, and insurance – delivered in a responsible and sustainable way.” In other words, it is all about enabling people and companies to benefit from financial products and services. Therefore, it matters. Especially in the mobile and digital age we live in, it really matters a lot. This is one of the reasons why the concept of “Direct Carrier Billing” and related solutions have emerged.
What is Direct Carrier Billing?
Direct Carrier Billing (DCB) is a solution created to solve payment problems and increase financial inclusion in the digital mobile environment. It runs on mobile devices with SIM cards and enables purchasing products or services without using cash.
For example, if you are a mobile game fan, you certainly know how DCB works. When you run out of lives in a game and you feel like buying extra lives, you click on a mobile payment button to activate DCB, confirm your credentials, and complete the purchase. The price is then added to your bill. The result: A happy gamer and a content operator!
How Operators Can Benefit From DCB?
For the consumer, a DCB solution is obviously a lifesaver. It enables him or her to pay for what is desired in the safest and most convenient way possible for the time being.
On the other hand, operators have even greater benefits in employing DCB solutions, ranging from revenue increase to competitive edge. Now, let’s have a closer look from the perspective of mobile operators.
Mobile users mostly prefer services and products that are free of charge. And there is a great number of content and app providers (or digital merchants as we call them) that offer such services and products up to a certain point, of course! If a user wishes to have privileges such as an ad-free mobile experience, enhanced services, or access to certain content, the provider needs to charge the user for such extra requests. And when the user buys this extra service, not only the merchant, but also the operator that offers the mobile payment platform, method, or option wins.
Whether you believe in stereotypes such as Gen Z or not, one thing is certain: More and more people expect to have the convenience of making almost all transactions via their mobile devices. Be it mobile shopping, mobile banking, or mobile gaming, DCB solutions give consumers what they want and therefore improve customer satisfaction.
The rules of the game changed immensely with the mobile and digital revolution. Today, both merchants and operators try to make a difference in the harsh competition for a greater share of the pie. One of the most effective methods to gain a competitive edge is to offer reliable, stable, secure mobile payment means and methods.
Last but not least, is the benefit of financial inclusion. This is, in fact, not only about operators, but also about people, communities, the global economy, and growth. Therefore, we believe it deserves a more detailed and in-depth look.
What is the Impact of Financial Inclusion?
As we stated above, financial inclusion is all about enabling individuals to benefit from financial tools, means, and opportunities. It is the fuel that keeps the car running. It is the engine that keeps the wheels turning. Especially during the peak of the COVID-19 pandemic, financial inclusion proved to have a huge impact on people’s welfare and economic growth.
It is not only about finances, but also about development, equality, well-being, and many other UN Sustainable Development Goals. It is a key to giving everyone the chance to become a part of the global economy, generate value, share, and grow. But how?
How Does Financial Inclusion Help Economic Growth?
Let’s go back a couple of years and remember the immediate economic impact of COVID-19. Many businesses were shut down, many people lost their jobs and livelihoods, and many services were interrupted. The reason for this huge negative impact was simple: Businesses were closed, and people could not go to work. Except for vital industries such as food and healthcare, almost no business or person was able to generate value or cash. This resulted in bankruptcies, higher inflation rates, increasing unemployment, and decreasing GDPs.
When people and companies are not a part of the economy, when they do not generate value or benefit from the value generated, they are not financially included in the system and this has a devastating impact on the economy, on both national and global scales.
How Can DCB Contribute to the Financial Inclusion of the Unbanked Population?
The lack of financial inclusion reveals the worst outcomes, especially in the case of limited financial tools and large unbanked populations. When an individual needs to buy a product or a service but do not have a bank account, a credit card, a checkbook, or any other concrete payment tool, DCB becomes an efficient method for meeting the needs.
Since smartphones and internet connections are globally widespread, DCB can help people benefit from digital products and services without having to work with a bank or use a credit card. This means production, consumption, and value generation can continue seamlessly even in the most severe conditions.
A fast and secure mobile payment and DCB solution by Telenity
Now that we know and understand the value DCB adds to the economy, we can also see why Telenity attaches great importance to DCB solutions.
With Telenity’s DCB solution, operators can easily charge and invoice subscribers and integrate with a diverse range of digital service providers.
The advantages of DCB by Telenity include:
• Managing and fine-tuning business flow rule sets for services,
• Performing an eligibility check before the initial use of DCB,
• Periodic charging for recurring subscriptions,
• Connectivity to multiple charging systems,
• Offering tailor-made solutions to address local regulatory needs,
• Integration with partners such as Google, Apple, Huawei, Amazon, and many others.