Mobile operators act as the gatekeepers for the UK’s most-used device, yet year after year they report a decline in average customer value. It is time for the mobile industry to unlock the potential of operator-driven mobile payments so merchants can reach customers on their preferred device and offer a truly mobile payment experience.
The Phone-paid Services Authority’s (PSA) Annual Market Review revealed that revenue per user for paid phone services rose 37% over the past year to £15.69. The PSA also found that the UK paid phone services market expanded 4.5% year-on-year to £700 million, with mobile accounting for 75% of total revenues. A major factor behind this growth is the continued rise of direct carrier billing (DCB), which posted a 31.4% increase in revenues. The report highlights consumers’ preference for the convenience of charging purchases to their phone bills and concludes that operator billing is “the platform upon which future phone-paid services and revenues will be derived.”
For both operators and merchants, these findings point to a clear growth opportunity: operator payments can deliver a frictionless checkout that consumers already trust and use globally with providers such as Apple, Amazon, Google, Spotify and others. With operator billing approaching mass-market adoption, growth is forecast to continue at an estimated 27% over the coming year. Subscription payments for entertainment, media, health and lifestyle services, along with transport payments, will be key drivers of consumer uptake because DCB combines convenience with the trust consumers place in their mobile providers.
The next five years promise significant development in mobile operator payments, driven by next-generation physical and digital offerings such as mTicketing. These innovations have the potential to accelerate DCB adoption across the mass market. Achieving this potential, however, requires the industry to collaborate on raising quality standards in the DCB market, balancing revenue opportunities for carriers and brands with strong consumer safeguards.
Although customer satisfaction has improved over the last year, trust remains a critical challenge. More than 8% of users have stopped using phone-paid services due to trust and problem-related concerns — a worrying figure that underscores the need for better protections and clearer communications. Encouragingly, 59% of users reported complete satisfaction, and 58% either maintained or increased their usage, indicating a solid base of satisfied customers to build on.
As the market matures and opportunity grows, developing robust compliance frameworks will be essential to strengthen customer trust and support wider adoption. Key actions include clearer customer education about DCB, improved transparency around billing, and enhanced customer service processes. By prioritizing consumer protection and service quality, operators and merchants can unlock the full potential of operator-driven mobile payments and create a secure, convenient payment channel that benefits everyone.