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There are entities involved in the mobile payments process

1. Merchants that sell products or services and allow customers to pay by cell phone

2. Customers who buy from the merchants using their cell phone as payment.

3. Payment Service Providers (PSPs) that are responsible for the payment process. The PSP controls the flow of payment transactions. Banks, credit card companies, network operators or independent payment vendors act as a PSPs
4. Trusted third party (TTPs) authorize the transactions and settle the payment.

A PSP and a TTP can be the same entity. For example, a bank or mobile network operator can function as both PSP and TTP. In this case, there would be only 3 entities involved in the mobile payment process.

Taking it one step further, an entity that is both a PSP and TTP can also offer goods or services for sale as a merchant. In this case there are 2 entities involved in the mobile payment process. An example of this would be a cell phone company that sells goods or services to its customers and allows them to pay using their cell phones.

The customer buys the goods or service and authorizes payment via the cell phone. The customer is registered with the PSP which authorizes payment. For example, a customer is that received their cell phone service is already registered with their mobile network provider.

The merchant sells to the customers. The merchant sends the purchase requests to the PSP and relays authorization requests to the customer. When the sale is authorized, the merchant provides the goods or services to the customer.

The PSP controls the flow of the transactions between the merchant, consumer, and TTP (if the TTP is a different entity than the PSP) When customers are register with a PSP they avoid having to key in payment details into the cell phone.

T Brandon is an expert in the payment processing industry and has over 15 years experience. Specialties include high volume and high risk merchant account processing as well as EFT , ACH, and Mobile Payments.

Payment Processing

Mobile Payments

// posted by wkzypk @ 2:19 PM