Charge it to my phone. It’s the shopper’s new mantra as wireless carriers increasingly let users tack on charges – racked up at other online stores – to their phone bills. BilltoMobile, Boku and
Zong (owned by PayPal)
are luring online
businesses to try their mobile payment software as an option for customers
who don’t have a credit
card or can’t be bothered
with punching their credit card digits on a Web page or an app. Hundreds of businesses,
including Facebook,
Zynga and dating website
Lavalife, are among
merchants that now accept
direct-phone-billing payment. And that’s
despite the high
commission rates – 10
percent to 20 percent of
the transaction – that the
billing companies charge merchants. (Much of that
goes to wireless carriers.) Direct-phone-billing is
much more prevalent in
Asia, Europe and the
Middle East, where
wireless carriers have
more sophisticated billing systems. The companies’ payment
systems are similar. You
get an option to pay with
your phone at the buy-now
page, where you type in
your phone number. Users of BilltoMobile and Zong
must punch in a secret
code that’s texted to the
phone immediately.
Charges show up on the
phone bill. “There no need to type any credit card numbers,” said Jim Greenwell, CEO of
BilltoMobile, a Korean
company whose system is
accepted by about 300
merchants in the U.S. You can’t buy a couch on
Target.com, however. U.S. wireless carriers only allow online purchases of
songs, videos and data
products, such as
Facebook credits and
imaginary plants for
“FarmVille,” an online game. The purchases are
limited to about $100 a
month because the
carriers don’t want
customers facing bill
shock, said David Yoo of Boku. To grow domestically, the
companies will have to
convince skittish
consumers who’ve been
victimized by fraudulent
and unitemized billing in the past from fly-by-
nighters that sold
ringtones and wallpapers,
said Chetan Sharma, a
mobile analyst. “The
industry has learned from the experience, and
there’s more vetting of the
merchants,” he said. Zong audits merchants by
verifying executives and
addresses, as well as
visiting the site, said Hill
Ferguson, PayPal’s head
of mobile. Security concern from
users who lose their
phones is also a lingering
issue. If a phone is reported lost to the
carrier, the payment
function is cut off
immediately, Greenwell
said. “We see very little
fraud.” Merchants, carriers and the companies will also
have to convince
customers that charges
will be itemized clearly
and that refunds will be
handled properly and quickly, said Steve Mott,
an industry analyst at
BetterBuyDesign. “They
have to accept some sort
of liability. Whether that’s
as good as credit cards remains to be seen,” he
said.
Source: physorg.com
Tech News by Shariq Kazi 