Insight
SMS Payments: The Text-to-Pay Ultimate Guide
Collecting payments by text is one of the surest ways to improve cash flow and create better customer experiences.
We’ll show you how to do it like the best.
SMS payments came out on top of our 2023 State of Business Texting Report as the #1 trend of the year, and for good reason. Texting for bill pay is often more convenient for everyone, speeds up collections, and even has lower costs than some other methods.
This guide shows you how sms payments work, when you should use them, and how text-to-pay can be used to make your work life way easier.
What Is Text-to-Pay?
Text-to-pay is the process of a business sending an invoice or request to pay a bill through text message (SMS), and the customer paying that bill through text, either by clicking-through a link to pay via a secure portal or by responding with a confirmation to initiate the transaction.
Both in this guide and in the wild, you’ll see text-to-pay also called “SMS payments,” “SMS bill pay,” “pay by text,” “SMS collections,” and other variations. They all mean the same thing.
Why Use SMS Payments?
Collecting payments through text message is a good business practice for the same reason you’d send a text at all. Everybody texts. It’s usually the quickest way to get someone’s attention and, in this case, get them to take action. That leads to significant improvements in your cash flows, receivables, and other important accounting metrics.
In short, text-to-pay is a useful tool for running a more efficient business. The rest of this guide will show you how it works and how to implement it successfully.
Are SMS Payments Secure?
Yes, SMS payments are secure. All payment transactions through Text Request and our payments partner Authvia are PCI DSS compliant.
What is PCI DSS Compliance?
PCI DSS stands for Payment Card Industry Data Security Standards. This sets the bar for consumer protection with digital banking and payments. Text Request’s Payments feature, in conjunction with Authvia, is PCI DSS compliant (secure).
3 Ways to Collect Payments by Text
These are the most common ways we see businesses implement SMS bill pay.
1. Text Links to Pay Online
Most modern businesses have an online payment portal where customers can login or enter their invoice number to pay their bill online. If you do, you can text customers a link to that page, along with their invoice as an attachment.
Yes, PDFs can be attached and sent via text message. If you don’t want to include an attached invoice, simply share the invoice number—or whatever details a customer may need to pay their bill online—in the body of the text.
An example message you might send:
[First Name], thanks for choosing us for your [service] needs! Your bill is [$xyz] and you can pay now at ourwebsite.com/billpay - [Company Name]
For more message examples, view our SMS Payments Message Templates.
2. Transact Payments via SMS
Payments can actually be transacted through text message and deposited directly into your bank account in real-time. Here’s the quick version of how that works.
Connect your business texting account to a payment processor
Connect that payment processor to your bank account
Send a “payment request” from your texting account to your customer
The customer responds with a confirmation code to initiate payment
We explain this process in detail in the How to Set Up SMS Payments section below. The main takeaway here is that you can effectively use text messaging as your payment processor, which is really helpful for getting paid faster, and for collecting payments without having to create your own online payment portal.
3. Send Notifications and Reminders
This is the most common and simplest way to use text messaging for bill pay and collections. It’s just texting for account updates, which 69% of consumers say they want.
You can send these payment notifications and reminders with a link to pay online or without, with an invoice included or without. The best choice depends on what’s best for your tech stack, goals, and current processes. (We’re happy to help you work through this—just ask.)
A couple of examples:
[First Name], quick reminder that your bill of $xyz is due on [date]. Call this number to pay today.
A new bill has been issued to your account. Please call us to pay or login at ourwebsite.com
[First Name], thanks for working with us! Attached is your invoice. Pay at ourwebsite.com/billpay - [Company Name]
How to Set Up SMS Payments (Text-to-Pay)
Here’s how to create and use SMS payments through Text Request. Text Request is a business text messaging software. Our Payments feature enables you to request, collect, and manage SMS payments. We partner with Authvia to enable these transactions. All of this is secure and PCI DSS compliant.
The quick rundown of steps to use Payments:
Login to your Text Request account
Visit the Payments menu option
Create your merchant account
Send a few test transactions first in Training Mode
Switch to Live Mode when you’re ready for real transactions
Send payment requests wherever you compose a message
Manage collections and reminders from the Payments menu
A few of these steps are explained in detail below. If you’re an existing customer, visit our Help Center for our full guides to Payments, or contact us with any questions.
How to Create Your Merchant Account
You’ll need to create a Merchant Account with our partner, Authvia, so your payments can be processed. Authvia essentially links your Text Request account to a payment processor that connects to your bank. Authvia’s default payment processor of choice is Payrix.
Start by emailing Authvia’s Contact Customer Success at customersuccess@authvia.com, and then their team will lead you through the rest of the process.
The process typically takes around 24 hours, so you can start sending payments quickly.
How to Send Test Transactions
Our Payments feature by default is set to Training Mode. Training Mode allows you to fully test the payment request process, before getting actual money involved.
Any payment requests made during Training Mode will be delivered, but the money won’t be processed.
Once you create your Merchant Account, you can leave Training Mode and start sending real payment requests.
How to Send and Manage Payment Requests
Go to the Payments menu, or select the dollar icon while composing a new message.
Then you just need to fill in the “request” fields with:
The amount of money you want to request
A description of what product or service the payment is for
The message you’d like to send along with the request
If you’d like to schedule the payment request for later date and time
Every payment request you send is recorded, so you can revisit them to:
Mark the request as paid—this is useful if the contact paid in a way that wasn’t via text message, but you still want to record it as completed in Text Request
Send an SMS reminder
Cancel the request
You can also create, filter, and download payment request reports into spreadsheets to further manage and track payments.
5 Great Opportunities to Use Text-to-Pay
Now that Payments is set up, here are five ways you can immediately start using it.
1. Updating Credit Card info
With Payments, customers reply to your SMS payment requests with a confirmation code to pay. First timers are then prompted to put their debit or credit card on file, so the payments process is even smoother the next time.
If their card declines during later transactions, customers get the option to submit their new card’s information. You can also just text contacts directly to ask for their updated info. This keeps the payments process chugging along with no bottlenecks caused by missing card info.
2. Collecting Payment Before Pickup
Any time a customer is scheduled to pick something up—whether it’s a package, a pet, or anything else—text them a payment request ahead of time. This keeps your front desk from getting bogged down with a line of people trying to check out.
The customer simply pays by text ahead of time, arrives for pickup, then everyone can get back to what they were doing before. It’s a win-win!
3. Over-the-Phone Transactions
Customers expect businesses to text now—that includes for sales and transactions.
As you work out deals and orders during text conversations with customers, it only makes sense to message payment requests directly, rather than sending them away to complete the transaction on your website or physical store. You’re guaranteed to close more deals faster this way.
4. Collecting Payment Immediately After Service
The moment a service is completed, text customers a payment request. Just like with pickups, this keeps customers from standing in line at your front desk to pay. Likewise, you don’t have to stick around and wait to receive payments, if you were doing a service beyond the office.
5. Replacing Direct Mail Invoices
Physical or emailed invoices get lost, but the majority of text messages are opened—so you know customers will see your texted payment request. It’s way more convenient and faster for both of you—not to mention cheaper, if you’re cutting out physical mail.
How Often Should You Send Payment Reminders?
SMS reminders are helpful, because customers sometimes forget to pay, no matter how streamlined your process is. That’s okay—Text Request makes it easy to track overdue payments and send text reminders, all in one place.
The amount of time that passes before you send payment reminders will depend on your industry. But a good rule of thumb would be to follow the same schedule and frequency that you use with your current late payment reminders.
Have a software that you already use for payment reminders? We may have an existing SMS integration with that software to help streamline things. Some examples are below.
Connect Text Request to Quickbooks
Our Quickbooks integration gives you the power to sync contacts and send SMS notifications throughout the payment process. Trigger messages when new invoices are created, and to confirm payments are made. You can even send text message receipts for payment confirmations and easy record-keeping.
Connect Text Request to Square
Our Square integration triggers text message notifications prompting customers to pay whenever a new invoice is created, so you can get paid faster. These notifications can even be set up for individual employees or locations.
Connect Text Request to Clio
Our Clio integration makes it easy to create automated billing notifications, with PDF invoices and payment links, that send straight from your office phone line.
SMS Payments API
Not seeing an existing integration for the payments software you use?
Our SMS API can build texting solutions into your applications, so you can collect payments with custom links and reporting to suit your business’s individual needs. Reach out to our team to learn more.
Ready to Start Texting for Bill Pay?
Text-to-pay is one of the smoothest bill pay experiences possible through the channel your customers use most. Text Request’s Payments feature gives you the power to harness text-to-pay, plus manage all your payments in one, secure place.
Still not sure where to start with implementing text-to-pay into your operations? Our 5-star team of experts is here with trainings and guides to help your business get the most out of Payments.
