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Insights and Expertise

The lesson for payments is straightforward: getting a cus-
tomer to decide to pay does not guarantee that the pay- People don't want more steps or
ment will be completed. more places to log in. They just

Closing the gap
want to complete the action and
For years, the industry has poured investment into add- get it off their to-do list.
ing new rails, faster funding options and more ways to
accept a card number, but the last mile of the journey can
remain stitched together from separate messaging, portal the percentage of customers who complete payments after
and payment systems.
receiving a message. The objective is not simply to gen-
That architecture often assumes the portal or app is the erate more messages, but to determine whether reducing
primary payment environment. Messaging serves mainly steps produces more completed transactions.
as a way to direct customers there, even as consumer be- Applications in regulated environments
havior has shifted toward mobile-first interactions and
quick responses to messages. Every time a customer has The issue becomes particularly important in collections,
to jump channels to complete a payment, another step is utilities and consumer finance, where outreach is closely
added between intent and completion. regulated and timely payment can have significant conse-
quences for both businesses and consumers.
If the last mile is where the structure breaks down, one ap-
proach is to reduce the number of places customers must In one utility test I observed, moving from a legacy mes-
go after deciding to pay. Messaging-native payments can saging setup to a compliant text workflow increased col-
shorten that distance by allowing a customer to receive a lections approximately 24-fold among a group of custom-
secure, timely message, see the amount due and available ers previously unresponsive to outreach attempts.
options and complete the payment by card, ACH or digital
wallet without navigating separately to a portal. Text-based payment flows are also being used in finan-
cial services and collections alongside traditional outreach
In my experience, consumers respond quickly when you methods such as letters and phone calls. For providers us-
remove friction and give them a payment method they al- ing these systems, the important questions include not
ready trust. People don't want more steps or more places only how many customers respond, but whether accounts
to log in. They just want to complete the action and get it are resolved earlier, collection costs decline and customers
off their to-do list. can complete transactions without unnecessary steps.
But messaging-native payments should not be confused Results in highly regulated environments also illustrate
with placing a generic link in a text that simply sends a why the design of the payment journey matters. A com-
customer to an Apple Pay- or Google Pay-supported por- munication channel by itself does not eliminate payment
tal. If the customer still must navigate, authenticate or friction. The value depends on what happens after the
search for the appropriate bill, many of the same points customer receives the message and how many barriers re-
of friction remain. A messaging-native payment flow in- main between that moment and completion of the transac-
stead seeks to contain more of those steps within a single tion.
journey so the customer can act without an unnecessary
handoff. A bit ironic, isn't it? A messaging channel doesn't neces-
sarily solve a messaging issue. Instead, it can bridge the
Text as a last-mile payment channel last mile between customer intent and completed pay-

Viewed this way, text can serve as more than a payment ment. For payments providers and their clients, the larger
reminder; it can also provide a last-mile channel for com- question is not simply how to reach customers, but how
easily customers can act once they receive that outreach.
pleting the transaction. It reaches consumers on devices
they use throughout the day and can provide a direct path Reducing the steps between the decision to pay and the
completed transaction may be where messaging has its
from notification to payment.
greatest value.
That reach comes with guardrails. Consent, verification Shawn Curtis is vice president and general manager of payments at
and regulatory oversight make text a highly governed Solutions by Text, a company focused on building customer relation-
environment. Reaching the appropriate consumer on a ships with compliance-first messaging and integrated text payments.
trusted device, presenting a compliant call to action and Before joining SBT, Curtis spent more than six years at Spreedly, where
enabling payment within the same flow can reduce some his work included helping companies modernize and scale their pay-
of the friction associated with moving customers between ments ecosystems. Contact Shawn via LinkedIn at linkedin.com/in/
channels. For billers, lenders and payments providers shawncurtis, and learn more about Solutions by Text at solutionsby-
evaluating this approach, relevant measures include re- text.com.
sponse rates, time to resolution, cost per transaction and
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