Exploring the Benefits of Text to Pay

A confluence of forces is reshaping the payments landscape. Geopolitical factors, capital market resets, commerce expectations, technology advancements, and societal responsibilities push payment players to innovate.

One such solution is text-to-pay, which allows merchants to request payment from consumers through a secure link sent via SMS. 

Convenience

For customers who’d instead not tack on another phone call or log into a website to pay, text to pay options offer a no-hassle way to settle their dues. Plus, most SMS payments are processed within minutes for quicker invoicing and receivables.

Customers who receive a friendly, text-based payment reminder will likely open it and respond promptly. It means that fewer bills go unpaid, which can save businesses money on late fees and interest charges.

Moreover, many SMS payment solutions are PCI-compliant, meaning customers’ credit card or bank account information is securely transmitted. With so many benefits, it’s no wonder that text payments have taken off. However, business owners need to understand the strengths and limitations of this contactless payment method.

Security

When making payments, most consumers will say that they prioritize speed, security, and convenience. Text-to-pay (SMS payments, text-based billing, or “pay by the text”) satisfies these ideals by providing an efficient, self-service payment process that customers can use on any cellular device.

Text-to-pay systems allow customers to securely complete transactions with a few clicks, rather than entering their credit card info over the phone like traditional methods. This is more convenient for the customer and reduces the risk of fraud.

Many small businesses and organizations rely on prompt customer payments to cover expenses and manage accounts receivable. Adding text to pay to the existing options of cash and credit cards can help ensure that invoices are paid on time, eliminating costly late fees. It’s also a great way to increase customer retention and brand loyalty.

Ease of Use

When you offer text to pay, you meet your customers where they are. Whether they are in your store, on the phone with your help desk, or a patient of your healthcare organization, all they need is a smartphone to complete a transaction securely with a single tap.

This convenience also enables greater accessibility for consumers who do not have access to traditional payment methods and streamlined operations for businesses that can automate invoicing through the same process. It also eliminates manual processing and follow-up calls on outstanding balances, improving business cash flow.

An excellent Text to Pay solution will automatically save customer information or link them directly to their account with a payment portal through the same SMS message. It allows customers to avoid entering sensitive credit card information on a website or over the phone and can help reduce data entry errors that commonly occur during transactions. Moreover, many systems integrate directly into small business accounting software, making it even more efficient for companies to manage accounts receivable.

Convenience

The world of payments continues to evolve, with innovations and shifting customer preferences driving change. The year 2023 will bring even more advances to the industry, including global trends like more sophisticated customer journeys, digital wallets, embedded payments, new flavors of buy now, pay later (BNPL), and the rise of digital currencies.

Text-to-pay is an easy way to meet your customers where they are in the messaging apps they use daily. And because 91 percent of mobile users keep their phones within arm’s reach at all times, a payment reminder delivered via SMS will likely be seen and acted on quicker than one sent by email or social media.

Businesses are also borrowing from the consumer playbook, with many incorporating customer portals on business websites and embedding payment capabilities into subscription service offerings to speed up payment cycles. This trend will continue as more B2B payment providers leverage omnichannel solutions and API-based integrations to deliver seamless experiences.