consumer experience, technologies

Payforit’s nervous twitch

Does the variety of on-device payment methods and the emergence of app stores pose any threat to Payforit, the UK’s cross mobile network billing standard?

Payforit was developed by the operators “to promote a trustworthy and consistent standard for paying by mobile, so that consumers can buy with confidence when they are making one-off payments or setting up subscription services via their phone”. (payforit.org)

Its success means a healthy and trusted market for mobile micropayments without the pricing ambiguities associated with traditional Premium SMS. However, since its initial announcement back in March 2006 it hasn’t quite taken off. Operator backing and promotion, revenue share arrangements and limited cross network tariff rates – now up to £10 cross network, have all played a part.

Relatively recent developments introduced by Accredited Payment Intermediaries – the companies who offer the Payforit solution to merchants, such as the ability to bill mobile accounts for traditional online purchases, have also proved a tricky sell up to now.

Sadly not too ubiquitous
Sadly not too ubiquitous

So will Payforit become the most popular method of billing for all purchases made through a mobile device? Or is it looking around at the other billing options and getting twitchy?

As the most transparent way of billing a mobile account, Payforit wins hands-down. By explicitly presenting cost on a payment screen, it beats Premium SMS for experiential transparency, (although operators’ without direct billing platforms may still use PSMS as the actual billing mechanism). Its strength here is reflected by interested noises being made by operators in other regions which are looking at a similar unified standard.

Yet Premium SMS remains more widely used as a payment mechanism, and its reliability is trusted by merchants. And Payforit doesn’t appear to be the first port of call for new mobile offerings either.

Purchasing an item through Nokia’s new Ovi app store presents the user with options to charge the payment to the “Phonebill” or a selection of credit cards, with no mention of Payforit. Then there follows a sequence of confirmation screens, more than would have been the case with Payforit, before…

To continue select ‘Purchase’.
Once your payment is validated, Nokia will send you a message to confirm the transaction.

(Sure enough, an instant SMS back from the Ovi Store short code 87050 – which probably was itself the billing mechanism.)

Without significant commitment to push Payforit onto new platforms like the Ovi Store, the future of Payforit will remain uncertain.

Device capabilities are expanding and technologies converging at such a rate that operators might eventually fear being hustled out of on-device micropayments altogether.

– Consider the success of Apple’s original App Store, which requires that a single bank account is set up in association with an App Store / iTunes account.

– Consider Paypal, which operates in a similar fashion for many online merchants. It remains more widely recognised and probably better trusted than Payforit.

– Consider entering in credit card details on a mobile internet website. Flirtomatic claims 10 percent of buyers from its mobile flirting site use this method. Though arduous, it cannot be dismissed because users are familiar with the process, trust it and will do it if they want something badly enough.

– Consider the aforementioned Ovi example offering several options, none of which included Payforit.

For the consumer, existing recognised and trusted brands hold sway, while slick user experience triumphs. With the appropriate support, Payforit can generate this trusted identity and create these experiences.

Each network has unique, individual constraints in terms of its promotion. But with every new billable mobile service launched that doesn’t employ Payforit, a serious second wind looks more vital.

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