Direct Carrier billing vs Premium SMS

Two of the mobile billing methods offered by Integrat, are Premium SMS and Direct Carrier Billing. What is the difference between the two and how do you know which one is better suited to your business?

Premium SMS

It works the same as sending a normal SMS where the mobile user (sender) pays a tariff each time he sends a text to someone. The purchase is added to their mobile account bill, or debited from their prepaid account.

Subscribers can be billed in two ways:

  • MO billing (mobile originated) messages are billed when a consumer sends an SMS to a premium short code.
  • MT billing (mobile terminated) messages are billed when a consumer receives an SMS on their handset.

The most well-known type of purchase this method is used for, is mobile entertainment like ringtones and games. MO billing is probably the more popular of the two.

Once the merchant confirms that they have received the payment, they will send the goods or open their service to the receiver. As you can imagine, Premium SMS holds numerous advantages for both the business and the consumer as it is virtually instant. However, if something goes wrong with the sending or receipt of the SMS, there are no guarantees that the consumer will receive her goods.

Direct Carrier Billing

It works much the same way as it also charges purchases directly to the consumer’s mobile account. However, it is a more secure way of doing mobile transactions and are often used to purchase goods outside of mobile products.

Another added advantage is that it allows the consumer to build a relationship with the merchant if she engages in repeat purchases.

Both Premium SMS and Direct Carrier Billing require the user to confirm their purchase and prove they have authority to bill the mobile number they have entered. This is done via authentication with a PIN,  header authentication (only applies to Direct Carrier Billing where the user is on their carrier’s mobile data network) or MO confirmation.

To use authentication through a PIN, it requires the user to enter a digit number (usually between 4-6 chracters) that was sent to their mobile via a standard or bulk rate SMS.

Herman Cremer
A seasoned professional with 20 years of experience in digital & mobile solutions and advertising.


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