Carrier Billing: is it more expensive?

How do the costs of carrier billing compare with cards?

When it comes to paying for digital services or products online, most people are familiar with using credit or debit cards. However, an increasingly popular alternative is carrier billing, which allows consumers to charge purchases directly to their mobile phone bill. At first glance, carrier billing might seem more expensive than using traditional card payments. But is it really? Let’s take a closer look at the hidden costs of processing card payments online and the transparency of carrier billing’s “one fee” system.

The Hidden Costs of Card Payments

On the surface, card payments might seem straightforward and low-cost. You pay a percentage fee per transaction, and that’s it, right? Not quite. Below the surface, card payments come with a labyrinth of hidden fees that often go unnoticed by the average consumer and even some businesses. Here’s what makes card payments more complex (and costly) than they initially appear:

Interchange++ Fees: These are fees paid by the merchant’s bank to the cardholder’s bank whenever a card is used. Interchange fees can vary significantly depending on the card type (credit vs. debit), the issuing bank, and even the location of the transaction.

Payment Gateway Fees: To process online transactions, merchants need a payment gateway that connects their website to the payment processor. Payment gateways often charge setup fees, monthly fees, and additional transaction fees.

Acquirer Fees: These fees are paid to the acquiring bank that processes card payments on behalf of the merchant. They often include a mix of flat fees, percentage fees, and sometimes extra charges for international transactions.

Chargeback Fees: Whenever a customer disputes a transaction, the merchant is not only at risk of losing the sale but also of incurring chargeback fees, which can range from $20 to $100 per incident.

Fraud Prevention Costs: The risk of fraud is an ever-present concern with card payments, and many merchants invest heavily in fraud prevention tools and charge insurance fees to mitigate the impact of fraudulent transactions.

Cross-Border Fees: If a purchase is made with a card from another country, the merchant might also face cross-border fees, which can be significant for businesses operating internationally.

All these costs add up, making the true cost of card processing much higher than just the headline rate. For the merchant, these fees can eat into profit margins, and the consumer might indirectly pay more due to increased prices to offset these hidden costs.

The Transparency of Carrier Billing

Carrier billing simplifies the payment process by allowing consumers to charge purchases directly to their mobile phone bill. This method offers several advantages that are often overlooked:

One Fixed Fee: Carrier billing has one fee that covers the entire payment process. Unlike card payments, where costs are divided into various fees, carrier billing bundles everything into one transparent charge. There are no hidden fees, and the price you see is the price you pay.

No Additional Processing Fees: There are no interchange fees, gateway fees, or acquirer fees with carrier billing. The transaction is straightforward: the consumer buys a product or service, and the cost is added to their mobile bill.

No Chargeback Risks: Since carrier billing does not involve traditional banking or credit card systems, there are no chargebacks. This reduces risk for merchants and keeps the process simple and secure for consumers.

Security and Privacy:  Carrier billing transactions do not require sensitive personal data like card numbers or bank account details, making it a safer option in many respects. This not only reduces the risk of fraud but also adds an extra layer of privacy for the consumer.

Instant Payments: Transactions are instantaneous, and there’s no need to fill out forms or enter card details. This makes carrier billing one of the most convenient payment options, especially for digital goods like in-app purchases, subscriptions, and gaming/iGaming credits.

Is Carrier Billing Really More Expensive?

At first glance, carrier billing fees can seem higher. This is because they are often presented as a single, higher percentage fee. The key difference is that with carrier billing, there are no hidden extras. The fee structure is simple, transparent, and easy to understand.

In contrast, card payments often seem cheaper until you factor in all the additional costs. When you add up interchange fees, acquirer fees, fraud prevention costs, chargeback fees, and other charges, card payments can be more expensive than initially anticipated.

The True Cost of Transparency

While carrier billing might initially appear to be more expensive due to its single fee structure, it’s important to recognize that this fee covers the entire payment process. Card payments, on the other hand, come with a host of additional costs that can add up quickly, making them far more complex and often more expensive than they appear. So, while carrier billing might seem pricier on the surface, its transparency and simplicity can actually make it a more cost-effective option overall. No payments icebergs here.

But, we should make something clear. We are not suggest giving up cards, they are an important part of the payment ecosystem and a trusted payment method for millions of people. We are also an acquirer. However, we had merchants initially wary of the cost of carrier billing because they can seem so much higher than that of cards, so we felt it our duty to make it clear. Yes, the prices may seem higher but in reality, they are not.  Carrier billing is the perfect addition to many merchants’ payment stacks.

Find out if it is right for your business.

 

Want to know more?

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Personal Data Policy Table of Contents for the Career Portal

1. General information

The DIMOCO Careers Portal is a platform that is designed to centralize and manage job applications made by applicants for positons within DIMOCO, and is operated by DIMOCO Payments GmbH, a company incorporated under 199901 y of the company register of the Regional Court of Wiener Neustadt, Austria, having its registered offices at Campus 21, Europaring F15/302, A-2345 Brunn am Gebirge, Austria. As such, DIMOCO Payments GmbH is to be seen as being the controller of the data.

For the purposes of this Policy:

  • any reference to “You” or “Your” shall mean the job applicant.
  • any reference to “DIMOCO” , “We” , “Us” or “Our” shall mean the entities of the DIMOCO group of companies, in particular, but not limited to:
  • DIMOCO Payments GmbH
  • DINAPE Solutions GmbH

2. What Data Will Be Processed?

During the application process, We will store and process the relevant information (including personal data) provided by You in Your application to DIMOCO, including particularly, but not necessarily limited to, Your gender, academic title, first name, surname, date of birth, address, citizenship, phone number, e-mail address and possession of a valid work permit in Austria as well as other data included in documents You chose to upload to the DIMOCO Careers Portal, such as CVs or recommendation letters, etc. We do not at any stage of the application process request that You provide Us with any sensitive personal data (e.g. information on racial or ethnic origin, political opinions, religious or philosophical beliefs, trade union membership, genetic or biometric data, as well as data concerning a natural person’s sex life or sexual orientation). Should You, however, proactively disclose any sensitive personal data to Us in Your application (e.g. in Your curriculum vitae), please be advised that We will consider this as You giving Us Your express consent to store and process such data in accordance with this Policy and applicable laws.

3. What is the Purpose of the Data Processing?

We process the data made available by You for the sole purpose of carrying out the application process, and in particular to assess Your application and contact You in connection with Your job application, and if applicable, future job openings at DIMOCO (the “Purpose”).

4. How the Data Will Be Processed?

The data You provide Us will be kept confidential and will be processed with due care, appropriately and in a way adequate and relevant to the Purpose expressly stated in this Policy. The data will be processed in compliance with applicable laws, in particular the General Data Protection Regulation (GDPR) of the EU as well as with the relevant provisions of the Austrian national law. The confidentiality and security of Your data is secured by appropriate technological and organizational means.

 

Each time You access the website of the DIMOCO group of companies (and by extension the DIMOCO Careers Portal), a so-called log file that records Your activity on the DIMOCO website will be created. This log file can collect information on the name of the webpage(s) You accessed, the date and time of Your request, the type and version of Your browser, Your operating system, the URL-address that directed You to the DIMOCO website and Your IP address. We use these files in order to protect the DIMOCO website against unlawful and criminal attacks. Furthermore, may We use these files to gather statistical data in order to optimize functionality of the DIMOCO website. The information gathered by the log-files is not at any point used in a way that could allow an identification of specific users.

 

The website of the DIMOCO group of companies (and by extension the DIMOCO Careers Portal) also uses small text files (cookies) that enable the storage of device-specific information on the system on Your PC, laptop, tablet, mobile phone, etc. Cookies do not cause any damage to Your device and do not contain or store any personal data (e.g. name, e-mail, phone number, etc.). Some cookies are saved on Your device and stay there until manually deleted. The cookies are used in order to recognize Your browser next time You visit the DIMOCO website as well as to optimize its functionality.

 

Please note that You can change the preference of Your browser at any time, such that You are informed in case that cookies are being used and have the possibility to allow the use thereof on a case-to-case basis. Please be advised that the deactivation of cookies could limit the functionality of the DIMOCO website.

5. Who Has Access to Your Data

No personal data You provide Us will be made available or transmitted to any third party without Your express permission. Access to the data provided by You will only be granted to authorized personnel of DIMOCO, particularly the HR department of DIMOCO Payments GmbH and the relevant DIMOCO managers responsible for the particular job vacancy You have applied and/or are being considered for.

6. The legal basis of processing and Your Permission and Rights

The processing of Your data for the Purpose is based on Your voluntary permission given expressly in the application process (Article 6 para 1 lit a GDPR). We are not permitted to and shall not process any of Your personal data without Your consent.

 

Even though the provision of certain information in the application process is stated as being “mandatory”, please note that You are by no means under any legal obligation to disclose such information to Us. Please be advised, however, that the non-provision of the information stated as being “mandatory” could have the result that We will not be able to consider or process Your application.

 

We are required to keep Your personal data for a period of 6 (six) months following the end of the application process. All of Your personal data will be erased automatically thereafter, unless You gave Us the right to store and process Your personal data for a period of up to 1 (one) year so that You can be considered for future job opportunities at DIMOCO. In this latter case, all Your personal data will be automatically erased after the lapse of the 1 (one) year period.

 

You should know that You have the following rights with respect to the information (including personal data) that You provide Us:

 

  • You have the right to limit or withdraw the consent You gave Us to process Your data and/or request the deletion thereof. If You should choose to limit the consent You originally gave Us, then We will act in accordance with Your instructions. If, however, You should choose to withdraw Your consent entirely, We will cease to process Your data immediately and will delete Your data accordingly. Please be advised that the limitation/withdrawal of Your consent or the request for the deletion thereof may automatically suspend any application process that has already started.

 

  • You have the right to request Us to inform You about the personal data We have stored about You.

 

  • You have the right to request Us to amend any incorrect data that We have stored about You.

 

  • You have the right to data portability, which means that upon request, We will transfer Your data to a third party that You nominate.

 

  • You have the right to lodge a complaint to the Austrian Data Protection Authority (Datenschutzbehörde) in the event that You are of the opinion that a breach of data security has occurred.

 

You can exercise the aforementioned rights at any time.

 

If You have any questions about Our data security or Your application, please do not hesitate to contact Us:

 

DIMOCO Payments GmbH

DIMOCO Human Resources Department

Campus 21, Europaring F15/302

2345 Brunn am Gebirge, Austria

E-mail: careers@dimoco.eu

Telephone: +43 1 33 66 888 – 0