Mobile billing in the spotlight

February 8, 2022

black woman in an african market receiving payment via contactless transfer from a customer using their mobile phones

Jonathan Kriegel


New research published by the Mobile Ecosystem Forum (MEF) provides a fascinating snapshot of the drivers pushing greater numbers of consumers to use mobile billing to pay for goods and services. The trade body’s Consumer Survey: Mobile Payments 2021 report is based on a poll of 6,500 smartphone users in Brazil, China, France, Germany, India, Japan, South Africa, Spain, the UK, and the US during November and December 2020.

It found that almost a quarter (24%) fund one-off purchases of mobile apps through their mobile phone bills and nearly a third (32%) content subscriptions for over the top (OTT) services like Netflix and Spotify. For many (27%), those subscriptions are already bundled as part of “free” or low-cost packages offered by operators alongside mobile voice and data minutes to drive adoption (more in my recent blog Telcos signing more video bundling partnerships than ever).

Of those surveyed, 34% reported that they did not use mobile billing to fund any purchases at all, however. That leaves telcos and mobile network operators (MNOs) with plenty of headroom for future growth. Still, they must also overcome challenges in persuading consumers that mobile billing is a safe and secure payment option that doesn’t result in unexpected or unwanted charges on their accounts.

Convincing the older generation appears to be a particularly tough task. More significant numbers of the over 55s (59%) and those aged between 45 and 54 eschew mobile billing in favor of other payment mechanisms. Conversely, younger consumers – notably those in the 25-34yr bracket who are more likely to be in work rather than full or part-time study – show the most enthusiasm. Amongst this age group, 36% fund content subscription services through their mobile phone bills, 30% have them bundled by the carrier, and 26% buy mobile apps. Only 30% don’t buy any goods or services using this payment mechanism.

Speed and convenience drive adoption

When asked why they use mobile phone billing for payments, consumers are apparent: it’s faster (cited by 39%) and more convenient (37%) than other payment mechanisms. But a much smaller proportion think it’s cheaper or safer than other channels (15%), indicating high transaction fees charged by most operators to use the capability and ongoing concerns about cyber security. However, cost and safety appear to be less of an issue for those who own Android smartphones than those who own Apple iOS devices. Of the former, 17% said they use mobile billing for payments because it is cheaper than alternative methods, while 16% felt it was safer. The equivalent figures for iOS device owners were lower at 13% for both.

The consumers surveyed by the MEF indicated numerous ongoing concerns with mobile billing payments that may prevent or limit their further adoption. Almost a third (30%) worried that their payment details would be stolen, for example, but a similar number (28%) felt that future payments would be authorized without their express approval. Around a quarter thought they may end up subscribing to something without realizing (27%), while 24% also anticipated that they might encounter incorrect charges on their account.

However, there were significant regional variations in these findings, especially when it comes to concerns about future payments being authorized without the customer’s approval. Significantly more people are worried about this in China (38%), Brazil (36%), South Africa (34%), and India (32%), for example. Consumers in China, Brazil, South Africa, France, and Spain also indicated higher anxiety levels around the prospect of their payment details being stolen.

Although 24% of consumers expressed fears around overbilling, a much smaller percentage (15%) appear to have been incorrectly charged by their mobile operator. Again, the problem is worse in some countries than it is in others – notably Brazil (24%), South Africa (22%), China (18%), Spain (17%), and India (16%) compared to just 5% in Japan.

Specialist help on mobile billing required

The MEF survey suggests there is certainly room for improvement. Still, its findings also indicate that most user concerns rest on consumers worrying that they do not have enough (or any) control over the payments billed to their mobile phone accounts. Managing the mobile billing process is complex and time-consuming for many carriers and is usually not a core business activity. Many could go a long way to addressing potential problems and ensure a smoother customer relationship by working with a specialist third-party mobile payment platform provider like us, especially when it comes to handling billing disputes and refunds.

And as well as giving consumers more transparency and control over their mobile billing transactions, MNOs can go one step further by delivering greater protection for the sensitive data containing financial and identity details stored on the smartphone. We wrote about this too growing volume and diversity of cyber-attacks targeting mobile devices last year. Carriers are ideally placed to work with best-of-breed cyber security suppliers and fraud intelligence providers to deliver additional defences on mobile devices wherever they happen to be.

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