How Does Caller ID Work- And Other Common Questions, Answered!

Published on November 12, 2023

How does caller ID work? This is a question that many customers ask our support team. This article is your go-to for any caller ID number-related questions.

Caller IDs became a standard feature on home phones in the later 1980s. Over the years, they have only evolved to suit mobile phones and, later, smartphones. A handy feature to identify incoming calls by name and number, a caller ID proved its worth to users throughout their 30-odd years of existence.

For businesses, political campaigns, nonprofits, and other industries engaged in cold-calling, the usage of caller IDs could have gone either way. If not utilized properly, they could have warned users that an unknown and possibly spam number was calling them, leading answer rates to drop dramatically. But it could also prove to be a great marketing technique that establishes a local presence or identifies the caller and increases the chances of getting an answer.

Unsurprisingly, many cold-callers jumped at the opportunity and built their campaigns to make optimum use of caller IDs.

If you are new to the whole caller ID number scenario, this post is just for you. We cover:

  1. The definition and process of setting a caller ID.
  2. How does caller ID work?
  3. How to set up your caller ID number on CallHub.
  4. Bonus: Setting up a dynamic caller ID to establish a local presence during calling campaigns, which can increase the answer rate by up to 20%!

We have divided the post into several FAQs to address these factors.

Let’s get to it.

What is a caller ID?

A caller ID is a phone feature displaying the calling party’s phone number (incoming call) to the recipient. Today, the feature is ubiquitous among any phone provider, including mobile phones, phone lines, or VoIP lines.

The phone company, which holds the caller information, passes it to the phone provider using the ASCII code (American Standard Code for Information Interchange). Your caller ID feature decodes it within milliseconds of receiving a call and displays the decoded information on your screen.

In recent times, caller ID has been used interchangeably for a phone number or name identification. However, the traditional (and accurate) term for the latter is CNAM (Calling NAMe).  

  • Caller ID: Identification of a caller with their registered phone number. This is determined by the database of the phone company and the recipient phone’s company.
  • CNAM: Identification of a caller with their registered name. Typically used by businesses, CNAM uses third-party services to establish its brand as an identifier.

How does caller ID number work?

On the callee’s side, the caller ID number works almost like a default action– like when a light goes on when you press a switch, except in this case, your phone carrier presses the button. A person receives a call and sees either a number (caller ID number) or a name (calling name). 

The process is slightly complicated on the caller’s side since they have to set up their calling identification with a carrier such as Twilio. Once they do, the carrier updates the information on its database, and the registered caller ID (number or name) appears on the recipients’ phone. 

If you are using a VoIP service, you can control and update the displayed number by making the changes directly on the service or with a service agent interference. 

How is a caller ID phone number determined?

Since the caller ID is exchanged from the caller’s phone company to the callee’s, the carriers in question are responsible for the caller ID. 

However, if you use a call center software or tool, you can determine which of your numbers goes out as the default caller ID to all your contacts. In such cases, irrespective of the device you use to make calls, your tool will interfere and send your default caller ID, replacing the individual ones. This way, any contact who wants to save your number or call you back can do so to a single phone number.

More on this in the section “How does caller ID work on CallHub.”

In the case of CNAMs, third-party services are responsible for the identification. Businesses (are advised to) register their CNAM data with phone carriers when registering a number. If a carrier does not provide such databases, the CNAM lookups are done using alternate methods and sources.

However, here, businesses and organizations must update their names and information with carriers regularly to avoid outdated or missing data. Since CNAM schedules vary from one service to another, it is important to keep track of your last updated date and relevant changes.  

How does caller ID work on CallHub?

On CallHub, you validate your phone number(s) for calling campaigns. The number you pick for a particular campaign will go out as your caller ID (i.e., it will be displayed on your contacts’ screen). 

A campaign manager can validate multiple numbers on their account and choose a unique one for each calling campaign. 

To validate a new number for your campaign, follow these steps:

  1. Click on “Numbers” on the left panel. You will be directed to a page that contains all your numbers validated for calling and texting campaigns.
  2. Click on “Add” under “Validated (Your numbers which can be used as Caller ID in voice and texting campaigns.)
  1. Add the new caller ID number and wait for a confirmation call.
  1. Enter the validation code sent to the number. Done!

Additionally, your agents can use the dial-in feature to use their own phone numbers for a campaign. The caller ID number, in such cases, will still be the default number you set and NOT your agent’s phone number.


Note: While a CNAM is great for branding and marketing purposes, it is not advisable (and in some cases, not even possible) for calling campaigns. The USA and Canada regulations require campaigns to display a number to enable contacts to call back. That won’t be possible with only a display name.

Bonus: What is a dynamic caller ID, and how to set it up?

A dynamic caller ID goes a step beyond your regular caller ID and establishes local presence with relevant area codes. A phone number with the local area code is 20% more likely to be answered, which is what makes a dynamic caller ID a potent tool in your calling campaign.

CallHub’s intelligent systems will match your caller ID to the state, state capital, or the largest city in the state according to the area of the callee.

Here’s how the dynamic caller ID works on CallHub

  • Our system will go through all the contacts in your contact list and determine the different states they belong to (by analyzing their area codes).
  • It will then rent numbers for each state prioritizing cities in the following order:
  1. State capital; (if not available),
  2. The largest city in the state; (if not available),
  3. Any other city in the state
  • All rented numbers are added to the dynamic caller ID block. You can enable the feature under the “Targeting” section of your call center campaign. For a voice broadcasting campaign, the same can be found under the “Settings” section.
  • You can choose between a new block (the system will go through the contact list anew) or an existing one. Dynamic caller ID blocks can be selected for multiple campaigns at the same time. So, if you are running multiple calling campaigns simultaneously and they contain numbers from the same states, you need not go through the creation of caller ID blocks for each. 

Important notes:

  • Dynamic caller IDs are currently only available in the USA, Canada, Australia, and the UK.
  • These caller IDs are chargeable. We charge $2/month for every number rented. If your contact list has numbers from all the 50 states in the US, you will be charged a flat fee of $100 monthly rental. Similar rules apply for other countries too.

To enable dynamic caller IDs for your campaign, please send us a request at [email protected]

The way forward

We hope this article has answered your question of “how does caller ID work.” At CallHub, we strive to make call center campaigns more efficient, productive, and fruitful. To that end, we offer features that make our client’s job easy while also giving desirable results.

The caller ID number and dynamic caller ID number are just two such examples.

Want to try us out for free? Sign up for your free account here

Feature image source:  Lindsey LaMont/Unsplash.