Anyone who purchased a ringtone in the late 1990s has some familiarity with carrier-based billing. However, as smartphones rolled onto the market in the U.S., carrier-based billing never really became a common general payment method for mobile users. Consumers still tap into carrier-based billing to purchase digital goods like apps and games, since carrier billing is a payment option in the Google Play, Amazon and Microsoft app stores (though notably not in Apple’s).
Worldwide carrier billing has branched out into the wider world of payments and allowed consumers to make a variety of purchases via phone – particularly in developing markets and especially when wedded with prepaid services. In the U.S., however, carrier billing thus far has not strayed far from its digital goods roots – though that is something that LevelUp, Sprint and carrier billing platform Danal are working together to change.
PYMNTS spoke to LevelUp’s Head of Partnerships Nick Herbold to get the lowdown on the newest edition to the mobile payments platform and how they hope it will make life easier for both users and their partner merchants going forward.
"The latest LevelUp partnership with Danal will going forward actually allow users of the LevelUp app to fund their accounts with their carrier bill,” Herbold explained. “We are specifically working with Sprint to launch this newest program so from now on, users who have a Sprint account will be able to use that as their funding source for paying for purchases via LevelUp as opposed to say a credit or gift card."
LevelUp customers will then pay their mobile charger as part of their monthly phone bill – Herbold told us that this newest partnership grew out of talks his firm had with the telecom about ways that carrier based-billing could be integrated easily into the wider stage of real world commerce.
"We got involved in the conversation first when talking to Sprint and they brought Danal into the conversation,” Herbold explained. “What Sprint was really looking for was interesting ways to use carrier billing to buy physical goods in the real world. Which right now is not really done in the United States. From the LevelUp side of the house, we are always looking for new ways to make our services more accessible to users and so this was a very natural expansion for us."
And it is an expansion that will ask little of its users – as of now, new LevelUp users on a Sprint phone will see the carrier billing option highlighted for them when they set up the app. As for use – Herbold noted that its functionally is designed to be a one-tap and go type of solution once a user has selected carrier billing as his payment method.
"This is a one button link-up – this is even easier than the scan the credit card feature we have included,” Herbold noted. “What we’re always open to is ways of making the process easier for users and looking for way to benefit the merchants. This is an alternative to the traditional credit card industry as a way for funding these purchases."
An alternative that Seth Priebatsch, LevelUp’s Chief Ninja, called out as a necessary part as payments is evolving away from the plastic.
“With a modern payment infrastructure, there’s no reason to be restricted to just the old-world of plastic payment methods. So today we’re excited to go one step further.”
And it is one step further that LevelUp is pushing with additional rewards for customers who change their billing setup. Those who pay via carrier billing will also get +10 percent of any rewards unlocked on the LevelUp platform.
And merchants can offer this new payment method without any sort of risk – LevelUp processes and sends the payment via ACH for carrier-funded purchases in the exact same manner they use for card-based purchases.
And, Herbold notes, though it was not in the original intention of the newest partnership – the integration of carrier billing also allows LevelUp access to the marketplace of consumers who do not currently use cards or traditional banking.
"It is clearly one of the benefits because there are many more people who have a smartphone than have a traditional debit or credit card, which gives us a great opportunity to offer services to a wider base."