SMS Payment Reminders: Secure a Path to the Future

Financial institutions lacking a focus on customer experience are missing a pivotal opportunity to connect with customers, build their brand, and secure a path to the future. COVID-19 drove a 35% increase in mobile banking customers (Deloitte, 2020), and it hasn’t slowed since. Mobile strategy for financial services should extend beyond brand-specific apps and tap into the phone’s native tools. Rich Communication Services, specifically rich text, is rising and will grow more than 200% in the next five years. (Juniper Research, 2022) and will increase SMS’s desirability. SMS already improves the customer experience by serving as a payment reminder, payment portal, and customer service solution. Its strengths will only continue to grow as the technology matures.

SMS payment reminders can be used at every stage of the repayment journey. It’s an effective tool for getting the customer set up for repayment, reminders about upcoming due dates, follow-ups when the payment is late, and personally connecting with a customer who is delinquent. A soft reminder through SMS when a customer misses a payment can ease tension, prevent an escalation, and build long-lasting relationships. SMS payment reminders increase on-time payments by providing safe and convenient access to a repayment portal in the same message. Let’s look at how is SMS able to achieve this better than any other communication channel.


There will be 8.2 billion people using mobile phones with native texting capabilities by 2023.¹ Phones are used to accomplish many of our daily tasks today, from the basics like ordering groceries and scheduling food delivery, to more complex activities such as opening an investment account or selling a house. They are significant enough that 75% of mobile phone owners look at their phones within 30 minutes of waking up.² While email and social media inboxes are jam-packed, it’s difficult to miss a text message. SMS gives financial institutions an instant way to deliver notifications to their customers that are guaranteed to be seen.

Scheduled Messages

Customers will come to expect friendly reminders delivered by SMS- no more remembering when and where to log in. SMS makes repayment or any action easier by putting everything right in the customer’s hands. Best of all, financial institutions can schedule these messages in advance to alleviate the burden on service teams and increase the likelihood of on-time payments.

Non-Invasive Communication

Chasing down late payments can be a time drain for service teams. When customers are behind on their payments and have ignored your initial attempts to collect funds, SMS provides a non-invasive tool for direct communication. SMS is hard to ignore, and 95% of all text messages are opened and read within three minutes.³ Two-way Texting capabilities allow delinquent customers to communicate directly with the financial institution in a non-threatening environment. Repayment plans can even be negotiated entirely over a text message. And unlike voice communication, multiple customers can be communicated with at a time, reducing stress and increasing team productivity.

Spam Free

Consumers are bombarded by spam on every channel, except for SMS, which is virtually spam-free, thanks to industry regulations and compliance standards. When consumers receive essential information regarding their financial obligations, they can trust that it’s coming from a secure source.

Cost Efficient & Effective

SMS’s benefits far outweigh the costs. It can significantly decrease your postage, print, voice, and administrative expenses. When you mail payment reminders, the only source of trackable feedback is whether the customer pays or reaches out to the service team. With SMS’s tracking abilities, you can lean about your customers’ behaviors. Tracking open and response rates and monitoring SmartURL™ actions gives insight into how your customers approach payments.


The ease and convenience SMS payment reminders provide are a major win for the digital consumer experience. But deploying the tool can be a significant hurdle for financial institutions. Data privacy is a primary concern and can be a considerable constraint for financial institutions. In a 2021 study, BRINKnews reported that 90% of respondents stated their trust was tied to data privacy and security, and that a data breach would lead 66% of them to sever ties completely with the institution. The consumer experience must instill confidence and safety at every step to be effective.

SMS compliance centers around garnering the proper consent, creating a consumer-controlled channel, and creating content that is appropriately written and sequenced. The type of consent for financial institutions to send payment reminders differs from the opt-in requirements necessary for marketing and sales promotion.

1. Getting Consent

Prior express consent is needed to send text messages related to payment reminders, account maintenance, appointment reminders, and statement notifications. Such permission can be given through loan agreements and credit applications. When a consumer knowingly volunteers their phone number, prior express consent is established, and non-marketing text messages may be sent. Per the FCC, it’s a great idea to provide the consumer with a disclosure that they are consenting to text messages when providing their phone number.

2. Ensuring Consumer Control

No matter what industry, giving consumers a logical and easy way to unsubscribe from text messages is essential. When consumers reply “STOP” to opt-out, the SBT software automatically sends one final message confirming receipt of the consumer’s consent revocation. Financial institutions cannot send any additional messages without a new, consumer-led opt-in. Each text message violation is $500 in statutory or actual damages, which can quickly add up when senders do not have an immediate opt-out process. 

Our API and user interface option facilitates customers’ ability to manage opt-out requests, ensuring that revocations are honored across all applicable forms of communication, even if they are submitted other than by reply text message. This API allows customers to communicate customer consent revocations to SBT for processing via SBT’s Stop Safety Net™.

3. Creating & Delivering Compliant Content

There are additional content rules that apply to financial institutions and businesses collecting debts. One of the most important rules to follow in each message is making sure the consumer knows who you are and the purpose of the message. That’s where SBT’s library of text message templates is invaluable. Our templates allow customers to adequately identify the sender, both by name and title. This step is vital when payment reminders shift into debt collection.

SMS payment reminders can benefit significantly from being scheduled in advance, helping messages meet compliance frequency and timeline standards. Payment reminders are vital to the customer experience; therefore, financial institutions need to be intentional with the amount and timing of each communication. In many cases, one message reminder will be sufficient. For those that need an additional push, it’s essential to do so respectfully and allow the consumer to respond on their terms.

With compliance built into every aspect of our business, SBT offers the most secure text messaging and payment platform. Security and trust are at the forefront of the SMS services SBT provides. By partnering with SBT, financial institutions can overcome obstacles hindering digital transformation and excel into a future of brand growth. Give your customers a convenient and easy way to stay on top of their payments with SBT’s SMS payment reminders.

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