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Updated Apr 01, 2024

How to Accept Mobile Payments via SMS

Streamline payments and improve customer satisfaction with this quick, secure payment method.

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Jennifer Dublino, Senior Writer & Expert on Business Operations
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SMS stands for “Short Message Service”; it’s commonly known as text messaging. While SMS in business is typically considered a communication tool, this mobile functionality can extend to invoicing customers and accepting payments. For example, a business may text a customer an invoice with a link to a secure payment platform. The customer can then enter payment information and confirm the purchase.

We’ll explain everything you need to know to send invoices and accept payments via SMS texting. 

TipBottom line
The best credit card processors can help your business accept payments in person, over the phone, online and via text.

How to start accepting SMS payments

SMS payment is a contactless payment method that allows anyone with a text-enabled phone to pay a business via SMS. Here’s how to start accepting these convenient payments at your business: 

  1. Find an SMS payment provider. To start accepting SMS payments, you’ll need an SMS payment provider to help you integrate messaging with secure, Payment Card Industry (PCI)-compliant payment processing functionality. Many credit card processors support SMS payments, and there are also specialty SMS payment providers. If you currently use a service for credit card processing and digital payment acceptance, check with the company to see if it supports SMS payment processing. If so, compare its features and costs to those of other SMS payment providers. (We’ll share more information on choosing the right payment provider below.)
  2. Select a plan. After you choose an SMS payment provider, work with the company to select the appropriate plan based on your anticipated SMS volume.
  3. Set up billing and services. Next, you’ll set up billing with the company and create your account. Depending on your provider, you may also need a third-party merchant account.
  4. Set up your customer contact processes. You’ll connect your customer database with the provider, create rules about who you’ll contact and when you’ll contact them, and create basic text messages to send for various payment situations. The provider will typically give you the choice of using your current business phone number or a virtual SMS number to receive payments.
Did You Know?Did you know
The best merchant account services offer affordable pricing plans, reasonable fees and fast sales deposits.

How do SMS payments work? 

SMS payment processes vary by provider. However, they typically involve the following steps: 

  1. You get permission to send the customer texts. As in opt-in email marketing, the customer agrees to receive text messages from your company.
  2. You send the customer a payment link. You initiate a text to the customer using the SMS payment provider’s system. Note that the SMS company provides a different phone number that’s distinct from your primary business phone number. (Alternatively, the customer can initiate a sale by texting your business a short code number or QR code. You would then reply with a link to the payment page.)
  3. The customer receives the link. The buyer receives an SMS message with the payment link text and selects the link.
  4. The customer arrives at the payment page. The link opens a secure, mobile-friendly payment page on the consumer’s mobile device.
  5. The customer enters payment information. The customer inputs payment information or authorizes your company to use a payment method already on file. The customer usually has the option to save the payment method for future payments.
  6. The customer may receive a confirmation code. Sometimes, the SMS provider will send the customer a unique code or an additional text confirming the intent to buy before finalizing the purchase.
  7. The payment is processed. The SMS payment provider processes the payment and sends the money, minus any fees, to your business.
FYIDid you know
It's essential for your customers to opt in to receive text messages from your business, helping you adhere to text messaging laws. Without a customer's consent to receive your texts, you could face fines and penalties.

Best practices for using SMS for payments and communication

As with all customer communications, there are ways to optimize SMS payments to create a great user experience. Here are some best practices to ensure seamless SMS payments: 

  • Initiate SMS payments promptly. It’s ideal to initiate SMS payments at the time of the sale or just afterward. If you’re selling a service, you can invoice immediately via SMS and get paid while you’re with the customer, whether you’re at a brick-and-mortar store, an event or the customer’s location.
  • Use SMS to follow up on missed payments. You can also use SMS to follow up on other forms of communication, such as mail or email, about collecting past-due payments. Texts are harder to ignore or miss than other kinds of communication are. And because the message arrives on a mobile device, paying by phone becomes much more convenient than writing a check. When it’s easier for a customer to pay, you’re more likely to get paid promptly. 
  • Add SMS payment options to marketing texts. If your company already uses text message marketing, adding SMS payment options can help you close more sales. If you’re already in a conversation with a customer over text and the customer expresses interest in buying a specific product or service, you can send an SMS invoice for that product immediately.
TipBottom line
SMS marketing and mobile marketing differ significantly. SMS marketing sends promotional materials via text, while mobile marketing is a multichannel digital marketing strategy.

Advantages of SMS payment systems for businesses

SMS payment systems bring distinct advantages to many businesses, including the following:

  • SMS payment texts can reach many customers. The vast majority of your customers will likely be able to receive your SMS payment texts. In fact, according to the Pew Research Center, nine in 10 U.S. consumers own a smartphone that’s capable of text messaging.
  • Text messages are opened and read quickly. Consumers are extremely likely to read and acknowledge your SMS payment text. In fact, according to SimpleTexting, over 80 percent of consumers check text notifications within five minutes of receiving them.
  • SMS payments help you get paid quickly. Fast payments improve cash flow, make your business more efficient and boost customer satisfaction, especially if you have customers who are waiting to pay.
  • SMS payments are contactless. Contactless payments grew in popularity during the pandemic and show no signs of losing favor. Customers like easy, contactless payment options.
  • You can send SMS invoices quickly. Businesses can send SMS invoices immediately after a sale. Fast invoices help create prompt payments.
  • SMS payments lower fraud risk. SMS payment systems help reduce credit card fraud and losses from counterfeit cash.
  • SMS payment systems support multiple payment types. Most SMS payment providers accept various payment types, including credit and debit cards, ACH payments, PayPal, and other digital wallets, like Apple Pay, Google Pay and Samsung Pay.
  • SMS payment systems don’t require point-of-sale (POS) hardware. When you use SMS payments, you don’t necessarily have to purchase hardware. (However, you’ll still likely need a POS system if you have robust in-store and online sales.) 

Implementing SMS payments is an excellent way to use business texting, especially if you find an SMS payment provider that works with your budget and helps you connect with customers. 

Bottom LineBottom line
With millions of smartphones and mobile devices in use, SMS payments are an excellent way to grow your business and foster customer loyalty.

What to consider when choosing an SMS payment solution

There are many SMS payment solution options, including credit card processors and dedicated SMS payment providers. Any SMS payment provider you consider should showcase data security and be PCI compliant. Beyond that, look for an SMS payment solution that meets these criteria:

  • It’s intuitive. It’s crucial for your SMS payment system to have an intuitive interface. You should be able to set up your message content, replies and other settings quickly and easily. A clear interface gives you control over your information and the ability to make changes without incurring service charges.
  • It simplifies transactions. Look for a solution that considers your customers’ convenience at every turn. For example, when your customers can save their payment information for future payments, it’s more convenient for them and increases sales.
  • It has a backup system. The best SMS payment platforms provide backup communication options, such as a phone number or email address, in case the payment doesn’t go through.
  • It supports two-way SMS. Two-way SMS allows you to set up automated SMS replies triggered by specific keywords to provide more information or give customers the option to speak to an agent.
  • It provides a quality connection. High-quality carrier connections ensure that your SMS messages get through and aren’t caught by telecom company filters.
  • It has a dedicated number. Your business should get a unique phone number, not a shared or random number. A dedicated number improves deliverability and assures customers that they’re not being targeted by a phishing attempt.
  • It offers lump-sum deposits. Most businesses prefer that transactions be deposited in lump sums, making it easy to reconcile their books.
  • It’s affordable. Some SMS payment providers charge by the number of SMS messages you send or by text conversation. Others charge by the range of SMS messages you send. If customers tend to pay quickly when they get the first text, an individual plan will likely be the least expensive. If they take longer to pay, the conversation or ticket method will be more affordable. If you intend to send out a high volume of SMS payment messages, bulk or range pricing will be your best bet.
TipBottom line
When you have a high-demand product (because it's new, innovative or on sale), text customers a QR code to reserve the product or give them a short code to text you. This will prompt your SMS payment solution provider to reply with a text payment link to complete the sale.

Top SMS payment solutions 

Finding and contracting with the right SMS payment system provider means comparing features, evaluating options, and identifying your needs and budget. To help you get started, here’s an overview of several popular and well-regarded SMS payment solutions, along with their fees, pros and cons. 






Monthly fee of $69 or $99, depending on the plan

Transaction fees:

  • Email payment requests: $0.02
  • SMS payment requests: $0.03
  • MMS payment requests: $0.05
  • All transactions: $0.20
  • QR codes for customer-initiated sales
  • Potential POS replacement
  • Individual pricing suitable for lower-volume businesses
  • Recurring billing and bulk payment requests only available on higher plans
  • Separate payment processing service required
  • Monthly fee

Payment Savvy

Pricing not disclosed

  • Good option for high-risk businesses
  • Wide variety of accepted payment types 
  • Option to offer full pay by text or just payment reminders
  • Opaque pricing
  • Few user reviews
author image
Jennifer Dublino, Senior Writer & Expert on Business Operations
Jennifer Dublino is an experienced entrepreneur and astute marketing strategist. With over three decades of industry experience, she has been a guiding force for many businesses, offering invaluable expertise in market research, strategic planning, budget allocation, lead generation and beyond. Earlier in her career, Dublino established, nurtured and successfully sold her own marketing firm. Dublino, who has a bachelor's degree in business administration and an MBA in marketing and finance, also served as the chief operating officer of the Scent Marketing Institute, showcasing her ability to navigate diverse sectors within the marketing landscape. Over the years, Dublino has amassed a comprehensive understanding of business operations across a wide array of areas, ranging from credit card processing to compensation management. Her insights and expertise have earned her recognition, with her contributions quoted in reputable publications such as Reuters, Adweek, AdAge and others.
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