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Microcontroller based SMS Micro E-load

Vending machine

A Thesis Topic Proposal

Presented to the Faculty of the
Department of Electronics & Communications Engineering
College of Engineering, De La Salle University

In Partial Fulfillment of
The Requirements for the Degree of
Bachelor of Science in Electronics and Communications Engineering


Cu, Joshua C.
Uy, Jeckson T.

August, 2006


1.1. Background of the Study

Presently, there has been a world-wide spread use of cellular phones. Cellular

communication plays an important role in our daily life. It helps us locate and be in touch

with another person in a remote location. Since the Philippines being a developing

country 33% of our population is under poverty (Senate Economic Planning Office,

2005). Wireless Telecommunications Company offered prepaid loading option that is

highly suitable in the Philippine setting. Subscribers purchase consumable credits for

their account in preset denominations. These gave subscribers limited option to choose

the amount they will load up.

Then in 2003, telecommunication companies addressed that problem by launching

a nation-wide auto reloading stations through a retailer SIM card that vendors can use to

pass an amount of load as specified by the subscriber starting at an appreciable amount of

money with an increment of one peso. This new prepaid loading service was introduced

to capture the interest of budget minded Filipinos or blue collared employees that prefers

to load up in smaller denomination. It is difficult for these people to purchase prepaid

loads amounting to hundreds of pesos in one transaction because of their daily budget.

That is why people are in a day-to-day basis of buying prepaid loads and a wide-spread of

auto loading services nationwide. Subscribers can reload from a minimum of P25 up to a

thousand with a P1 denomination. Business people are attracted to this service because it

is a low investment business which a person can manage on his/her own.

1.2. Statement of the Problem

The current process of e-load reloading is typing the password, recipient’s phone

number and the amount of prepaid credit. A mere “0” added to the amount could lead to

an enormous loss of income. There will be no means to cancel the transaction once it has

been sent. Considering that the earnings are small, any mistakes made are devastating.

That’s why it is very important to encode the proper amount and number to the GSM

device. A prepaid load can also not be delivered properly when the vendor themselves

commits mistake in encoding the recipient’s number. Telecommunication companies are

not liable to the mistakes done by the retailer. That’s why there is a need to eliminate the

cause of this error.

There is a need to automate the current auto loading system implemented here in

the Philippines. As seen in most stores, the prepaid auto reloading services are being done

manually with the vendor using his/her cellular phone to make the transaction.

Considering that the transaction is being processed manually, there is the chance for the

seller to commit unwanted mistakes, mistakes which could lead to money loss or the loss

of income. To avoid these unnecessary mistakes, there is a need to automate (“interview”,


1.3. Objectives

There is a need eliminate the cause of error in the conventional auto reloading


1.3.1. General Objective(s)

To automate the prepaid auto loading services implemented here in the

Philippines by constructing a vending machine.

1.3.2. Specific Objectives To use a microcontroller. To use GSM device interfaced with microcontroller in sending

masked SMS. To be able to accept bills and coins. To be able to give the proper change if necessary. To provide a dot matrix LCD to the system. To log all transactions made in the microcontroller’s internal

memory. To use an external keypad module as inputs to the system. It should be able to run 24 hours a day, and 7 days a week. To use a CMOS battery to be the back up battery memory storage. To provide security measures in case of tampering. It should be able to perform self-diagnostics on its components. To provide retrieval means of stored information on memory


1.4. Scope and Delimitation

1.4.1 The system will be using a Nokia based model GSM device.

1.4.2. There will be no exploration on the complexity of microwave frequency

since GSM bands are in the microwave frequency.

1.4.3. There will be no exploration in the complexity of the GSM module.

1.4.4. The SMS application of the said GSM will be used.

1.4.5. Programming of the microcontroller will be extensively covered in the


1.4.6. The device will only be limited to cater two networks.

1.4.7. Our study will be limited to the use of a readily made bill feeder and

verification device.

1.4.8. The keypad interface device that will be used for the study will be a

complete module.

1.4.9. The model of the vending machine chassis will be designed by the thesis


1.4.10. The actual fabrication of the vending machine chassis will not be done by

thesis proponents.

1.4.11. Testing parameters of the device would be limited to delivery time, and

response time

1.4.12. Delivery time performance would not consider an occurrence of a busy

network which is beyond the team’s control.

1.4.13. The system can detect and inform about an occurrence of a busy network.

1.4.14. The efficiency would be based on response time of the system.

1.4.15. The system should be able to check for GSM connection to network to

ensure service.

1.4.16. The system will only provide change if there are stored change available.

1.4.17. The system will be able to withdraw from the on-going transaction upon

power loss.

1.4.18. To store 70 coins of 1, 5 and 10 peso denomination each.

1.4.20. To store the number of bills as specified in the data sheet of the said bill


1.4.21. The logging system should be able to store memories up to 1 week worth

of transactions.

1.4.22. An extended memory may be used in case more memory is demanded.

1.5. Significance of the Study

This study will aid people who are engaged in the prepaid reloading industry by

automating the conventional method being practiced even as we speak. This thesis project

will help distributors avoid, or even eliminate the tedious task of inputting the mobile

phone number and the amount to be reloaded which is, in most cases, where the error

cause by negligence occurs.

There will be room for franchise expansion since the thesis will then have a

corresponding hardware, the device made can be placed anywhere. Similar to a vending

machine, this device will be a stand alone prepaid reloading machine. It will further

expand the horizon of business entrepreneurs by placing this.

The study involves integration of the whole system into a smaller device that

could take up a small area. The study hopes to open a business opportunity in a form of

vending machine investment.

1.6. Description of the Project

This thesis project will be composed of a microcontroller, a keypad, an LCD

display, a money feeder, a money changer, a GSM module and a power supply. The

microcontroller serves as the brain of the whole project; this is where all the decisions

and calculations happen.

Initially, the user inputs the amount using the keypad. Then the user will then be

asked for the money to be deposited in the coin acceptor or bill acceptor. Then the device

will have to ask for the phone number of the said account. Then the device should prompt

a question to proceed or not while displaying the amount and the phone number for visual



Figure 1. System Flow Process







Figure 2. Component Structure

Figure 3. System Process Flow Chart (detailed breakdown of figure 1)

1.7. Methodology

The Methodology that will be applied will be classified into three (3)

different parts; Research, Hardware implementation, and Software


1.7.1. Research

The research would compose of statistical study on the usage of e-load in

the Philippines. The group will be take advantage of the facilities inside campus.

The library for accurate research; Books and journals will be very much used

because of its legitimacy and advancements. The internet will also be used due to

its accessibility and up-to-date content like online articles, statistics, and product

catalogs. Finally, consultation with the adviser will surely be considered.

1.7.2. Hardware Implementation

This would involve the familiarization of microcontrollers that are

available in the market. For the selection of the microcontroller the group will be

considering the price and specifications that would fit our application. The

hardware in the money collection module will be a coin feeder. The display will

be an LCD display matrix with backlight. A keypad will accept the input

parameters to operate the vending machine. The housing will be a stainless steel

specially fabricated to the dimensions that will contain the whole system. The

memory would likely have 60K x 4 pages, jumper selectable memory. If more

memory is needed then an extended memory module would be used.

1.7.3. Software Implementation

The software would entail the programming language that depends on the

microcontroller chosen. Preferably C language would be explored by the group.

Other forms of programming language will be based on Nokia GSM device and

the bill & coin validation section.

1.9. Estimated Budget of the Project

Part List (Php)

Microcontroller 1200

GSM Unit 4000

Coin Feeder Package xxxx

Bill Acceptor xxxx

Power Supply Module 2000

Chassis 5000

Shipment 1200

Miscellaneous 500

Total 16,700 Php ++



2.1. Filipino prefers to load up in small denominations in a day to day


The greater majority of Filipinos still prefers to buy things in a “patingi-tingi”

basis just enough for a day of use. Examples of these things are shampoo, food, cooking

oil, sugar, toothpaste, etc most of which are in sachets and tetra packs. Repacking these

things and considering the accumulative profit in terms of bulk sales is larger than selling

it originally as is, making it an interesting strategy for many corporations today. Since

majority of the people have no choice but to buy only what they need for a day because

of budget constraint. Having to split what they earn in one day into many expenses that

they need everyday, the majority resort in buying small but cheaper things so that their

budget would fit and they would get through the day. This led to the idea of

Telecommunications Company in proving micro-loads and retailing as a form of a small

business. Telecommunications Company repacked packets of airtime into smaller

denomination that people can choose for their own convenience (Goloy, 2004).

2.2. A higher profit in retailing E-loads

It has always been the use scratch card to load up a prepaid account. The profit of

selling such card is quite small considering the base cost of the card itself. Discounted

denominations of prepaid cards were an issue brought about by numerous competitive

dealers which resulted to a measly profit margin. The percentage of commission that the

telecommunication company can no longer be increased because of the cost in terms of

service and every aspect involved up to the point it was delivered to the distributor. The

development of the E-load solution brings forth reduction of cost from the production

cost of scratch cards to the cost of security that handles & transports the cards. Selling

airtime entirely over the airwaves via text-messaging removed the security risks and the

considerable associated costs. Because of this reduction of cost, a larger merchant

discount can be given to also please the distributor. Commissions of between 6 and 7

percent were improved to between 13 and 15 percent of the transaction cost (GFG

group). In addition, the option for micro-entrepreneurship can also be set in a larger

investment wherein a dealer can invest and mange multiple retailer to sell load. This form

of load are referred to as micro E-load, commonly known in the street as simply E-load

(Rimando, 2004).

2.3. Majority of the telecommunication subscriber are still prepaid users

In the recent statistical study of a telecommunication company for their investor’s

briefing, 80% of the wireless subscribers are still prepaid account. The statistics of

subscribers per year to year basis clearly show that prepaid subscribers dominate the

postpaid users (Globe, 2003).

2.4. Interfacing serial cable using data cable for communication in GSM

devices with PC or Microcontroller

Interfacing GSM devices to upload certain instructions like HyperTerminal

messaging, operator logo manager, ring tones and picture messages is achievable with the

use of data cables and programs. It is also possible to download information like

information stored in SIM card and phone memory. Embedded microcontroller design

interfaced with a GSM has already been done (Lagura et el, 2004).

2.5. Microcontroller

Microcontroller is a computer-on-a-chip used to control electronic devices. It is a

type of microprocessor emphasizing self-sufficiency and cost-effectiveness

(“Microcontroller”, 2006). It is a highly integrated chip that contains all the components

comprising a controller. Typically, this includes a CPU, RAM, some form of ROM, I/O

ports, and timers. Unlike a general-purpose computer, which also includes all of these

components, a microcontroller is designed for a very specific task – to control a particular

system. As a result, the parts can be simplified and reduced, which cuts down on

production costs.

2.5.1. CPU (Central Processing unit)

It is a component in computers which interprets instructions and processes

data contained in computer programs. The CPU is the brains of the computer.

Sometimes referred to simply as the processor or central processor, the CPU is

where most calculations take place. In terms of computing power, the CPU is the

most important element of a computer system.

2.5.2. Input/output Interface

It is the collection of interfaces that different functional units (sub-

systems) of an information processing system use to communicate with each

other, or the signals (information) sent through those interfaces. Inputs are the

signals received by the unit, and outputs are the signals sent from it. I/O devices

are used by a person (or other system) to communicate with a computer. For

instance, keyboards and mice are considered input devices of a computer and

monitors and printers are considered output devices of a computer. Typical

devices for communication between computers are for both input and output, such

as modems and network cards (“Input/output”, 2004).

2.5.3. Peripheral Devices

It is a type of computer hardware that is added to a host computer in order

to expand its capabilities. More specifically the term is used to describe those

devices that are optional in nature, as opposed to hardware that is either

demanded, or always required in principle (“Peripheral”, 2006).

A peripheral is any computer device that is not part of the essential

computer but is situated relatively close by. Some peripherals are mounted in the

same case with the main part of the computer, as are the hard disk drive, CD-

ROM drive, and NIC. Other peripherals are outside the computer case, such as the

printer and image scanner, attached by a wired or wireless connection.

2.5.4. RAM (Random Access Memory)

The most common computer memory which can be used by programs to

perform necessary tasks while the computer is on; an integrated circuit memory

chip allows information to be stored or accessed in any order and all storage

locations are equally accessible

2.5.5. ROM (Read Only Memory)

A class of storage media used in computers and other electronic devices.

Because it cannot be written to, its main uses lie in the distribution of firmware

(“Read-only memory”, 2006). It is a memory whose contents can be accessed and

read but cannot be changed.

2.5.6. Clock generator

It is a circuit that produces a timing signal (known as a clock signal and

behaves as such) for use in synchronizing a circuit's operation. It can range from a

simple symmetrical square wave to more complex arrangements. The basic parts

that all clock generators share are a resonant circuit and an amplifier (“Clock

generator”, 2006).

2.6. Bill Acceptor / Validator

A bill acceptor validates paper currency and then sends a corresponding I/O signal

to its output connector. It doesn't give change, validate coins or scan magnetic cards. Bill

acceptors are found in vending and gaming machines, amusements, gasoline pumps, drop

safes, automated payment systems and Internet kiosks. A bill acceptor typically contains

between five to 20 optical sensors such as LEDs and/or magnetic sensors. These sensors

read data points off the bill, which are then digitized and compared with internal currency

recognition software for validation.

It is a component of electronic vending machines and other devices that accept

paper currency. They were introduced in the U.S. in the early 1980s. While in the past,

these devices were extremely susceptible to failure and jamming due to folded or

damaged notes, they have improved remarkably in recent years and now include such

features as automatic jam ejection and automatically calibrating sensors. Cleaning cards

are available to remove contaminants from the machines (“Bill validator”, 2006).

2.7. Coin Acceptor

Coin acceptors are also known as a coin mechanism, it is a device that recognizes

coins. It is built into vending machines, arcade cabinets, etc. It performs its function by

evaluating the coin based on its weight, size, and/or magnetism, and then sends an

appropriate electrical signal via its output connection (“Coin acceptor”, 2006). It doesn’t

give change; that is the function of a coin changer. Coin acceptors are found in vending

and gaming machines, amusements and Internet kiosks.

2.8. Short Message Service (SMS)

It is a service available on most digital mobile phones that permits the sending of

short messages between mobile phones, other handheld devices and even landline

telephones. Other uses of text messaging can be for ordering ringtones, wallpapers and

entering competitions. There are also many free services available on the internet that

allows users to send text messages for free. You can also find more information on the

many forums available on the Internet (“Short message service”, 2006).


Abbreviated as SMS, the transmission of short text messages to and from

a mobile phone, fax machine and/or IP address. Messages must be no longer than

160 alpha-numeric characters and contain no images or graphics.

Once a message is sent, it is received by a Short Message Service Center

(SMSC), which must then get it to the appropriate mobile device.

To do this, the SMSC sends a SMS Request to the home location register

(HLR) to find the roaming customer. Once the HLR receives the request, it will

respond to the SMSC with the subscriber's status: 1) inactive or active 2) where

subscriber is roaming.

If the response is "inactive", then the SMSC will hold onto the message

for a period of time. When the subscriber accesses his device, the HLR sends a

SMS Notification to the SMSC, and the SMSC will attempt delivery.

The SMSC transfers the message in a Short Message Delivery Point to

Point format to the serving system. The system pages the device, and if it

responds, the message gets delivered.

The SMSC receives verification that the message was received by the end

user, then categorizes the message as "sent" and will not attempt to send again

(“Short message service, n.d.”).

2.9. SIM Tool Kit Application

The SIM Application Toolkit is a set of commands which defines how the card

should interact with the outside world and extends the communication protocol between

the card and the handset. With SIM Application Toolkit, the card has a proactive role in

the handset (Gemplus, 2003). SIM Toolkit programmed into the special GSM SIM card

essentially enables the SIM card to drive the GSM handset interface, build up an

interactive exchange between a network application and the end user and access or

control access to the network. For the first time the SIM card has a proactive role in the

handset. This means that the SIM initiates commands independently of the handset and

the network.

SIM service menu are menu driven SMS preset format. It can be related to

automatic form filler where a basic structure in SMS form in order to request a certain

service from the telecom company the number of the destination is already prepared. This

can prove to be helpful for the subscriber because he/she would no longer have to

remember keywords, format, and number to request a special service from the telecoms


As the Short Message Service (SMS) becomes mature and with the application of

SIM Tool Kit Application, menu driven service becomes the dominant in designing the

service menu. User feels much comfortable by making selection from the menu rather

than listening to the voice instruction through phone and presses the appropriate button

(Chanson, 2001).

2.9.1. Mobile Banking

It is a provision and an ailment of banking and financial services with the

help of mobile telecommunication devices. The scope of offered services may

include facilities to conduct bank and stock market transactions, to administer

accounts and to access customized information (“Mobile Banking”, 2006).

Areas under Mobile Banking:

• Mobile Accounting

• Mobile Brokerage

• Mobile Financial Information Services

2.9.2. Information service

This service gives subscribers the benefit of gather information in a

particular area of interest (e.g. Stock price, movie schedule, sporting news,

weather, CNN News).

2.9.3. Mobile data & fax

The Mobile Data / Fax feature allows you to make wireless data and fax

calls. With this feature, you can send and receive fax messages, connect to and

surf the Internet, send and receive company mail, and do other data applications

(“Smart”, 2005).

2.9.4. WAP (Wireless Application Protocol)

It is an open international standard for applications that use wireless

communication (for example, Internet access from a mobile phone). WAP was

designed to provide services equivalent to a web browser with some mobile-

specific additions, being specifically designed to address the limitations of very

small portable devices. It is now the protocol used for the majority of the world's

mobile Internet sites, otherwise known as wap-sites (“Wireless Application

Protocol”, 2006).

2.9.5. Mobile chatting room

This is where fellow subscribers meet. People meet in a certain room

where they will be able to get to know one another by chatting. This service

provides the subscriber the benefit to chat with other subscribers.

2.10. RS232 Standard

RS-232 is a standard for serial binary data interconnection between a DTE (Data

terminal equipment) and a DCE (Data communication equipment). It is commonly used

in computer serial ports.

The Electronic Industries Alliance (EIA) standard RS-232-C as of 1969 defines:

• Electrical signal characteristics such as voltage levels, signaling rate, timing

and slew-rate of signals, voltage withstand level, short-circuit behavior,

maximum stray capacitance and cable length

• Interface mechanical characteristics, pluggable connectors and pin


• Functions of each circuit in the interface connector

• Standard subsets of interface circuits for selected telecom applications

The standard does not define such elements as character encoding (for example,

ASCII, Baudot or EBCDIC), or the framing of characters in the data stream (bits per

character, start/stop bits, parity). The standard does not define bit rates for transmission,

although the standard says it is intended for bit rates less than 20,000 bits per second.

Many modern devices can exceed this speed (38,400 and 57,600 bit/s being common, and

115,200 and 230,400 bit/s making occasional appearances) while still using RS-232

compatible signal levels (“RS-232”, 2006).

2.11. Personal Error

Personal Errors may arise from a personal bias of the observer in reading an

instrument, in recording an observation, or his particular method of taking data, As well

as mistakes in mathematical calculations. Example of this error is the taking of incorrect

values from the measuring instruments caused by not looking at the screen at a

perpendicular angle. This may also be called Parallax Error (Fontanilla, 2002).

2.12. SMS bit string can be encoded and decoded using computer


Standard SMS message can be up to 160 characters long and up, where each

character is 7 bits according to the 7 bit default alphabet. The conventional eight-bit

messages wherein a maximum of 140 characters can be composed are usually not

viewable by the phones as text messages, instead they are used for data for example smart

messaging and OTA provisioning of WAP settings, while 16-bit messages are used for

Unicode text messages.

There are two ways of sending and receiving SMS messages: by text mode and by

protocol description unit (PDU) mode. Text mode is all about encoding the bit stream

represented in PDU mode. Alphabets are encoded in different modes when displaying

SMS message. The most common options are "PPCP437", "PCDN", "8859-1", "IRA"

and "GSM". These are set on the phone itself when you will choose what proper

encoding is for the telecoms company is using. So an application capable of reading

incoming SMS messages can thus use text mode or PDU mode.

Receiving a message or string of information(hexadecimal digits) in PDU mode,

entails getting the message and a lot of meta-information about the sender like SMS

service center, time stamp, address length, type of address, protocol identifier, data

encoding scheme, sender's number etc. All of which can be translated into 8-bit octets

while the message octet represent 7-bit data (Petterson, n.d.).

2.13. History of vending machine: Its success and innovations

A vending machine is a machine that dispenses merchandise when a customer

deposits sufficient money in order to purchase the desired item, where the presence of

personnel is no longer required for every purchase. Moneys in a form of bill or coin are

validated by a currency detector. Vending machines were believed to be invented long

ago in the year 215 B.C. where a contraption that accepts coins in exchange for holy

water used for ritual cleansing. Since the day it was invented till now almost anything

were sold in a vending machine to the early post stamps, candies, gumballs, cigarettes

and tobaccos to the present day snacks, drinks, and digital photo printing . Particularly in

Japan, the time vending machine was first introduced, struck the interest of the Japanese.

The popularity and demand for vending machines was mainly attributed to the high

population density, limited space, a preference of shopping on foot, low rates of

vandalism and petty crimes. Innovations made in vending machine offered products and

services like hot and cold beverages, heated snacks, burgers, candy bars, cigarettes, photo

printing, mini sticker photo printing, toiletries, toilet rentals, mobile phone charging

depot, gambling depots, arcade games, prepaid cards, music CD burning, karaoke,

videoke and many more (“VENDING”, wikipedia.org).


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