-the website then displays the amount of Bitcoin to send and an address
-the consumer then sends the Bitcoin
-as soon as the payment processor detects a payment the processor uses an automated telephone service to call the merchant
-the automated voice announces through the phone the amount in local currency that was sent followed by a pin number (the pin is setup by the merchant initially to prevent spoofing)
-if the message announces the correct amount the sale is completed
-the payment processor then sends the merchant the funds as normal
I wouldn't do it this way exactly, although you are onto something clever.
Let's say I'm a merchant, and I don't have a smartphone or computer handy in my store but I want to accept Bitcoins, what do I do? All I have is a feature (see: dumb) phone. Well, let's say BitPay had a solution for this, what would it look like?
First, I would have to sign up for BitPay when I got home. I enter my cell number and all other relevant details. They would give me a QR code to print out. In that QR code is an extended public key for an
HD wallet. I take that QR, stick it on my checkout counter. Now you come into my store, wanting to buy a stick of gum. You scan the QR code in you smartphone's Bitcoin wallet application, and send me whatever amount I told you.
When the transaction has been broadcast to the network and BitPay's nodes successfully recieve it, either an SMS is sent or a
USSD connection (depending on the locale, needs GSM) is made to confirm the receipt.