What Is an Online Charging System?

An online charging system (OCS) is a type of payment system that makes it possible for companies providing communications services to initiate charges for services rendered in a real time fashion. The exact process used will vary, based on how the pricing matrix for the services provided is set up. Typically, when the charges involved have to do with services assessed on a per-minute/per-connection basis, the online charging system can initiate the charge as soon as the service session is completed, using financial data kept on file with the provider.

One of the easiest ways to understand how an online charging system functions is to consider how a teleconference company can bill a customer for a conference call. With this form of call accounting, the process begins as soon as the conference call session is ended, usually when the telephone line designated as the leader or moderator line releases from the call and all other lines are also released. At that point, the detail for the conference call is downloaded from the conference bridge to the provider’s billing system. There, the call usage is rated based on the pricing extended to that customer and an electronic invoice is created in the system.

Once the invoice is created, the online charging system then uses financial data to draft a credit card or a bank account for the total cost of that conference call. Assuming the funds are received, they are transferred into the provider’s bank account. One of the features that can work in tandem with the OCS is a feature in the billing system that generates and emails an electronic invoice to the client immediately. When this is the case, it is not unusual for the online charging system to also forward the client a confirmation of payment.

A significant advantage to the use of an online charging system is that providers are able to receive payments in real time fashion, without much of the cost and time delays associated with more traditional billing processes. This increases the frequency of cash flow, while also making it possible to create unique pricing packages for different customers with very little effort. Customers benefit because the charges are settled quickly and there is no opportunity for the application of late fees or charges. In addition, the ability to receive a confirmation of the payment that includes an electronic invoice that is already marked paid in full can make it easier for that client to keep his or her accounting records up to date.