Combining SMS and Email for Better Payment Recovery

Email-only reminders miss the mark

Most SaaS businesses rely on email for billing and dunning communication. It’s easy to automate and expected by customers. But when it comes to collecting past-due payments, email alone is not enough. Inboxes are crowded. Messages get ignored, buried, or deleted. Customers may not even see the reminder until days later. That delay creates problems for operations teams trying to keep cash flow on track and reduce aging receivables.

The longer a payment goes unaddressed, the more manual follow-up it creates. Teams spend time escalating cases, resending invoices, or deciding when to escalate. All of that effort could be avoided with better communication tactics from the start.

Multi-channel reminders reach more customers

The best way to improve response rates is to meet customers where they are. A strong multi-channel dunning strategy combines email with SMS, in-app alerts, and when needed, phone follow-ups. Each channel plays a role in ensuring the right message reaches the right person at the right time.

SMS payment reminders are short, timely, and hard to miss. Most text messages are read within minutes. Adding SMS to your reminder sequence can speed up response and payment actions. In-app notifications work well for active users who log in frequently. These alerts can prompt payment while the customer is already using the product. For longer overdue accounts, a quick phone call can clarify questions and prompt a resolution.

A mix of channels reduces your reliance on any one method. If email delivery fails or gets overlooked, another channel picks up the slack. This redundancy helps maintain collection timelines and improves your recovery rate.

Inconsistent messaging causes confusion

Multi-channel doesn’t mean multi-message. It’s critical to maintain consistency across each platform. Conflicting or duplicate reminders create confusion and reduce trust. A customer who receives 3 different messages about the same invoice may hesitate to take action. They might wonder if they already paid, or if the system made a mistake.

Align your communication with clear messaging and timing rules. Each channel should support the same goal: prompting payment without pressure. Use centralized templates, synced schedules, and shared payment links. This approach keeps the customer experience simple, professional, and actionable.

Automation must scale with customer volume

Manual follow-up doesn’t scale. As your customer base grows, chasing down past-due invoices by hand is no longer feasible. You need a system that automates personalized communication across email, SMS, and other channels without adding more work to your team.

Look for a dunning automation platform that supports flexible workflows by customer segment, invoice amount, or payment method. Set up tiered escalation logic that determines which channels to use and when. For example, send email on day 1, SMS on day 3, and follow up with a call if no action by day 7. Automating this logic ensures consistent follow-up without oversight gaps.

Your platform should also support link tracking, status reporting, and integration with your payment gateway. That allows you to monitor effectiveness, identify stuck accounts, and improve messaging based on performance.

Investing in a multi-channel dunning process is not just about faster collections. It’s about building a scalable, repeatable system that supports growth without increasing headcount. It protects your cash flow, improves the customer experience, and gives your operations team more time to focus on strategic work.