PAYG Mobile Phone Charging And Billing

Charging and billing takes two broad forms: post-paid and pre-paid.

PAYG Mobile Phone Call and Text BillingPost-paid is when the cost of a call is added to your account at the end of your call and you receive a bill at the end of the month or end of the quarter or other billing cycle.

Pre-paid charging and billing is when you pay an amount into your account in advance, often referred to as “Credit” and the cost of your call, text or data transfer, is deducted from your credit as you go.

Pay As You Go is a form of pre-paid billing – you have a credit balance and the cost of your calls, texts, and data transfer, is deducted, as you go, from your credit.

Although Pay As You Go is a pre-paid system you are still billed but perhaps not in the conventional way that you might normally expect, by means of, for example, a paper or email bill.

Post-pay and Pre-pay billing can both involve complex systems and algorithms (ifs and buts) and to go into either in complete depth and detail is beyond the scope of this article.

At SIMsurprise we are primarily focused on Pay As You Go, sometimes referred to as Pre-Pay, so we shall focus the attention of this article on Pre-Pay billing – which, as mentioned above, is quite complex so we shall endeavour to keep this article brief yet informative and understandable.

Pre Paid, or Pay As You Go, is a system which involves Real-time billing – the call you make now has to be charged to your account – or credit balance – now, as you begin the call and during your call.

Why does the billing and charging have to be made in Real-time for Pay As You Go?

Quite simply because the idea of Pay-As-You-Go is pretty much that.

You actually pay in advance – top up your credit, make a call, send a text, or transfer data by means of browsing the Internet and your credit balance is reduced as you make a call, send a text, or browse the Internet – your balance reduces at a rate determined by the tariff that you are on and the type of call that you are making – for example mobile to land-line, mobile to mobile, or UK mobile to non-UK mobile or land-line.

When you add credit (top-up) your sim card – the money does not physically get put into, or on, your sim card.

Like a bank account which has a unique account number, your sim card also has a unique account number – you might recognize this as your phone number in addition to your phone number your network may have in their database additional numbers which you are not aware of simply because you do not need to know, or use, them.

The credit money – cash that you perhaps pay over a shop counter, or transfer from your bank account, is then credited to your sim card account number which is connected, or linked, to your phone number.

What happens with billing when you make a call, send a text, or browse the Internet on your mobile phone?

There are several platforms, or gateways, that carry out real-time billing.

Any two or more networks might use different platforms, or gateways, to each other, so the following process can operate in slightly differing ways – depending on the specific gateway, or platform system, used by your network.

All the following happens extremely fast – so fast that when you make a call, send a text, or browse the Internet, you probably do not know this is all happening.

The following also happens at intervals during your call – so that the “system” knows whether or not you have sufficient credit to not only make the call, but continue talking once the call is connected, or to continue browsing the Internet once you have started.

Below we explain the basic principles of what happens when you make a phone call – the same principles apply to sending a text, or browsing the Internet.

So what actually happens when you make a call?

  1. You dial the phone number you wish to call;
  2. Your phone connects to the pre-paid switching system - sometimes referred to as a platform or gateway;
  3. The pre-paid switching system detects your phone number as well as the phone number you are calling and sends your account information to the real-time billing system;
  4. The real-time billing system authenticates your account and determines your current balance in minutes applicable to the call you are making using the tariff that you are on, and determines the maximum duration permitted for the call;
  5. The information in step 4 above is sent to the pre-paid gateway;
  6. If there is sufficient credit, the call is connected. If there is insufficient credit available in step 4 above, the call is denied;
  7. When the call is over the pre-paid gateway sends the call duration to the pre-paid billing system which calculates the actual cost of your call and updates your account balance. Your credit will be reduced accordingly.

Once the maximum duration of the call is determined in step 4 above:

  • If the call lasts for less than this maximum duration – all is fine – you will have some credit left over at the end of the call.
  • If the duration of the call approaches the maximum duration permitted, the system may or may not give you a warning that your credit is running low.
  • If the duration of your call reaches the maximum permitted duration, your call will be terminated and you will have to top-up with more credit before being able to make another call, send another text, or browse the Internet.

Some pre-paid systems (platforms or gateways), offer a variation on the above description of events, by using a “Reserve” amount from your overall credit available.

For example if you have £20.00p credit an amount, for example £5.00p, will be used as a “mini” balance or reserve.

Your initial balance will, at this stage, be temporarily reduced to £15.00p.

The call will proceed as per the above steps, based on the example reserve of £5.00p – if the call is still in progress when the £5.00p reserve is about to run out, a further £5.00p reserve will be deducted temporarily from your balance. The first £5.00p will be now permanently deducted from your initial balance.

This will continue until either you end your call, or your total credit runs out.

If your call ended before the first £5.00p (or during any subsequent) reserve was used up, for example your call cost £4.00p (out of the £5.00p reserve) – only £4.00p will be deducted from your credit balance.

When you send a text, you have written the text, entered the phone number you wish to send the text to, and pressed send.

The system above will do the same as per a phone call:

Ascertain your account balance, the cost of the text is determined, and then the system will determine if there is enough credit to send the text – if there is sufficient credit your text will be sent, if not enough credit is available the text will not be sent.

If the text is sent, details of the cost of sending the text is then sent to be deducted from your balance and your balance is updated accordingly.

Billing or charging platforms can be provided "in-house", that is brought in and operated by the Mobile Network Operator (MNO), or Mobile Virtual Network Operator (MVNO), or outsourced to an Mobile Virtual Network Enabler (MVNE) or Mobile Virtual Network Aggregator (MVNA).

You might like to read our article about Mobile Virtual Network Aggregators, Enablers, and Operators.