How do SMS transaction costs vary by provider and region?

SMS authentication is widely used, but the cost per SMS OTP varies significantly depending on region, provider, and service quality. Businesses using SMS-based authentication must account for these fluctuating expenses, which can scale into millions of dollars annually.

🔹 Geographic Location:

• Some regions have higher carrier fees, making SMS authentication expensive.
• International SMS messages often cost 2–5x more than domestic SMS.

🔹 Telecom Provider & Aggregator Fees:

• SMS pricing depends on whether the provider is a direct carrier, aggregator, or third-party gateway.
• High-quality SMS (direct carrier routes) costs more but ensures better reliability.

🔹 Volume Discounts & Enterprise Plans:

• Businesses with high SMS traffic may negotiate lower per-message costs.
• Smaller companies often pay higher rates for SMS OTP services.

💰 United States & Canada:

• $0.01 – $0.05 per message (depending on provider and carrier fees).
• Toll-free verification and compliance fees may apply.

🌍 Europe:

• $0.02 – $0.10 per message, with country-specific regulations affecting pricing.
• GDPR compliance costs can increase SMS-related expenses.

🌏 Asia & Middle East:

• $0.04 – $0.15 per message, with some countries charging premium rates.
• Network congestion and fraud risk impact pricing stability.

🌎 Africa & Latin America:

• $0.05 – $0.20 per message, with some providers imposing higher transaction fees.
• Poor network infrastructure can cause SMS delays or failures.

📈 Scaling Costs: Enterprises sending millions of OTPs per month face huge authentication expenses.
🚨 Fraud Costs: SMS traffic pumping scams artificially inflate SMS usage, driving up costs for businesses.
⚠️ Operational Burdens: Managing multiple providers for global SMS delivery increases complexity.

✅ No Per-Transaction Costs: Passkeys eliminate SMS authentication expenses entirely.
✅ No Regional Pricing Variations: Passkeys work seamlessly across all locations without extra costs.
✅ Phishing-Resistant Security: Passkeys prevent fraud and attack vectors linked to SMS-based authentication.

For businesses struggling with high SMS costs, passkeys provide a scalable, cost-effective authentication solution.