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In Business Operations Last updated: June 25, 2023
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In a world where identity theft and online fraud are increasing alarmingly, securing your platform and users becomes daunting. 

The best way to outsmart hackers is to validate users with One-Time Passwords (OTPs) sent over SMS.

However, not every business has the resources to set up an in-house OTP system. This is where OTP providers come in.

If you’re looking to protect your online presence from cyber threats, keep reading as we explore the top OTP providers and marketplaces available today!

Introduction to OTP Providers/Marketplace

An OTP provider offers a convenient solution for businesses looking to implement two-factor authentication or validate users over SMS. Technically, these tools use SMS API (Application Programming Interface) to integrate text messaging capabilities into websites and applications.


OTP providers automate the whole process, from code generation to verification, without complicating things for you or end users.

But since OTPs are a delicate matter, most businesses need help finding a reliable provider. And for them, the OTP marketplace is the best shot.

An OTP marketplace connects businesses and organizations with multiple OTP providers. It acts as an intermediary, allowing you to compare different OTP solutions, features, and pricing and get the best deal. One such marketplace is RingCaptcha (more on this below)!

Anyways, whether OTP provider or marketplace, the core benefits of SMS OTPs boil down to the following:

  • Fraud and data protection
  • Better user experience
  • Flexibility and Scalability

However, each benefit deserves special attention, so let’s dive in.

Benefits of OTP for Your Business


#1. Helps In Two-Factor Authentication

Two Factor Authentication, or 2FA, is a security system that requires two distinct forms of verification to access your account or resources.

Firstly, the user must enter the credentials they had set for the account. Next, they need to verify through a code, or OTP sent to their registered device. Ideally, 85% of accounts prefer receiving OTPs via SMS. 

And so, having an SMS OTP system for your business adds an extra layer of protection without complicating things for the user. 

#2. Passwordless Logins

In a world where 90% of internet users are worried about their passwords being hacked, you are the one offering them passwordless logins. Sounds like a dealbreaker?

For example, if a potential client can’t complete a transaction because they fail to recall their password, they might bail out on the purchase. We’re not making this out of thin air.

76% of users claim they often give up on a purchase because of password issues.

Although guest purchases are a popular option among e-commerce stores, one way or another, you would need to validate user identity. 

Passwordless authentication can help you do both, validate users and retain customers.

#3. Transaction Authentication

OTP-backed two-factor authentication is innately more secure than passwords when making online transactions. We say so because OTPs can’t be used for attack since they become invalid after a set time frame. 

In fact, TOPT (Time-based one-time password) comes with an expiration window ranging from 1 minute to 7 days. Since OTPs become invalid shortly after they’re generated, OTPs are worthless to hackers. And thus making every transaction secure for the customers and your business.

#4. Better User Experience

Obviously, users enjoy it when not asked to remember passwords. OTPs offer a simple, user-friendly experience. 

One simple integration makes verification quick and easy through a user’s mobile device. Plus, users can avoid paying extra charges or performing another tiresome login process. 

You see,

  • Everyone has SMS on their mobile phones 
  • It’s a familiar and comfortable communication channel
  • People can receive texts almost anywhere in the world for next to nothing 

#5. Easy for Businesses To Integrate and Scale 

Organizations can easily integrate verification APIs into their product or apps. Soon enough, you realize the ROI of integrating SMS OTPs is well beyond expectations. The process can quite literally pay for itself by:

  • Safeguarding against cybersecurity threats
  • Better user experience
  • Freeing up your IT team and resources for more important tasks

So yes, SMS OTPs are a great opt-in for businesses. Even if you don’t prefer setting up an in-house system, you can choose a reliable OTP provider. 

How to Choose an OTP Provider?


When making a choice, it’s better to have a selection criterion in place. Below listed are some factors you should consider when choosing an OTP provider for your business.

  • End-to-end Security: OTPs are a sensitive matter, so choosing a reliable provider that offers secure SMS services is crucial. Skim through providers with high deliverability, encryption, and 2FA automation tools.
  • Ease-of-setup: Ensure that the SMS API offered by providers is easy to merge with your existing systems and platforms, with clear documentation and developer-friendly APIs to make integration seamless.
  • Cost-effectiveness: Considering the number of users looking to avail of 2FA, sending SMS OTPs could be heavy on your pockets. Thus, choose an OTP provider marketplace that offers customized plans or volume-based discounts. Additionally, check that the platform has no hidden fees.
  • Customer Support: Look for providers that offer 24/7 customer support over email, chat, and call. This makes solving OTP-related issues easier and builds customer trust.
  • Additional Features: A few add-ons go a long way, such as reporting and analytic tools, customizable templates, and the ability to send messages in multiple languages. These features can help improve the effectiveness and efficiency of your OTP solution.

And now, it’s time to look at the best OTP provider or marketplace to help you validate users over SMS. 🥁


YouTube video

ShoutOut provides SMS API integration for better customer engagement and communication. One of its solutions, ShoutOut Lite, offers OTP API for two-factor authentication, mobile number verification and one-time password (magic passwords) like use cases.


  • Automates the whole process, from OTP generation to verification and troubleshooting
  • Easy and hassle-free integration of SDKs and REST API with any platform like Shopify, Woo Commerce, Magento, and more
  • 99.93% uptime with auto-scaling and zero maintenance windows
  • Instantly obtain sender IDs or reference IDs for every OTP request made by your application

Apart from these, ShoutOut helps businesses run SMS campaigns via multiple tools like personalized messaging, analytics, and scheduling. It’s an excellent choice for small and medium-sized businesses.


YouTube video

RingCaptcha is a user verification and fraud prevention tool that provides SMS and Voice 2FA products to validate users. The platform offers an OTP provider marketplace, letting you compare and choose the most reliable provider with the best deliverability.


  • Mix-and-match primary and fallback routes to ensure the best OTP reliability at affordable prices
  • Has an auto follow-up feature that automatically detects and sends another OTP if the user misses one
  • Enable out-of-band mechanisms, like ‘Dial-for-Help,’ Human Touch,’ and ‘AI Assist,’ if the user fails to receive the OTP
  • Each OTP request passes through heuristics-powered security filters to ensure request validity 
  • Pre-built SMS notification templates or customized templates to incorporate branding message

With the RingCaptcha marketplace, if a provider increases your pricing, you can switch to another one with just a few clicks. You also get access to other features like fraud analytics, verified/blocked lists, deliverability optimization, and more.


YouTube video

Exotel is a leading and reliable enterprise cloud communications company. Its OTP solution caters to top organizations in India and Southeast Asia, like Flipkart, Redbus, Ola, Practo, and more.


  • Offers superior quality SMS and voice OTP verification service with high deliverability and low latency
  • Seamless integration to any platform using Android SDKs and REST APIs; an affordable and scalable solution with a pay-per-use pricing model
  • Best in class uptimes of 99.94%, including operator uptimes; fail-proof delivery of OTPs within 8 seconds
  • Get easy-to-read detailed reports consisting of insights related to OTP operations, deliverability, and efficiency

With Exotel, you can achieve a handsome delivery rate of 92%. Besides, the platform offers a 7-day free trial, with 1000 free calls and SMS credit. Plus, 24×7 customer support via phone, email, and Twitter


YouTube video

Textlocal offers scalable enterprise-grade SMS solutions trusted by over 165,000+ customers globally. The platform’s OTP SMS solution ensures easy, secure, and reliable security for your application.


  • Easily integrate to over 500+ popular applications using Zapier in a few clicks
  • Quickly generate unique codes and merge them into an SMS text using easy-to-integrate SMS API
  • Integrate with simple, high-speed SMS SMPP API and start sending text messages in minutes
  • Securely transfer data to and from Messenger via SFTP to ensure you always have the latest information available

Apart from OTPs, you can insert links, documents, videos, or vouchers personalized for each user. Moreover, you can create interactive surveys in minutes and analyze the results with easy-to-use tracking tools.


YouTube video

OneLogin is a leading identity and access management solution trusted by over 5000+ customers globally. Its OneLogin Protect OTP mobile app lets you perform multi-factor authentication for multiple accounts with the click of a button.


  • Has over 6000+ pre-integrated on-premise and cloud applications
  • Available for Android, Android Wear, Apple iOS, and Apple watchOS, letting you perform actions on the go
  • Built-in OTP generator that lets users respond to a push notification on their smartphone or watch and login effortlessly
  • Time-Based OTP (TOTP) algorithm that makes the OTP invalid after 30 sec; you can extend the time on mobile devices to improve reliability and user experience

With OneLogin, you can access world-class customer service, including personal customer success advocates, 24/7 technical assistance, a content-rich help center, and ongoing education events.


YouTube video

SecureMFA provides OTP authentication for Microsoft ADFS (Active Directory Federation Service). It enables ADFS servers to provide multi-factor authentication (MFA) using a TOTP and via a third-party provider’s API endpoint like SMS, Email, or phone.


  • Generate OTP passcodes for unlimited account users; store OTP data in MS SQL or MS Active Directory Attributes
  • Easily initiate OTP account logout or deactivation
  • Customize user interface and data values when sending into an API endpoint
  • Support of ADFS CSS themes and ADDS multi-forest trust relationships

Besides these, managed API Gateway service is provided by vendors like Amazon (AWS SNS), Microsoft (Azure API Management), etc.  


YouTube video

ClickSend is an enterprise-grade SMS provider that lets businesses send, receive, and track SMS text messages worldwide. Its SMS OTP solution helps confirm user identity, safeguard your customer data, and strengthen overall online security.


  • Has an easy-to-navigate dashboard to track OTP SMS, view sender IDs and follow-ups; send SMS directly from Google Sheets
  • Easily integrate with your software or application using APIs in NodsJS, Python, Java, C#, Ruby, etc
  • Enterprise-level security of OTPs and customer data with 100% uptime SLA guarantee
  • Built-in marketplace with over 900+ apps from e-commerce, social media, and other categories

ClickSend’s pay-as-you-use software saves you from getting bottlenecked in lock-in contracts with recurring monthly fees regardless of use. With over 90,000+ customers sending billions of messages around the USA, ClickSend still breathes high-performance deliverability. 

D7 Networks

YouTube video

Founded in 2012, D7 Networks is a dream endeavor of a group of dedicated mobile experts specialized in Worldwide SMS Transmission. Its user-friendly 2FA Verifier API is easy to set up and seamlessly integrates with your workflow. 


  • Complete automation of the verification process, including unique OTP generation and management
  • Developer friendly API to quickly integrate D7 to any application; get global coverage around 7 continents with a single API
  • Pay-per-use model, plus no carrier complexity, makes D7 an affordable and reliable solution
  • Completes the entire OTP verification process in 15 to 20 secs, ensuring a high deliverability

D7 Networks is a go-to choice for start-ups and enterprises. It has the best start-ups under its name, including Airbnb, Uber, Agoda, DHL, and more known brands.

Conclusive Thoughts

Using OTPs to verify users over SMS is more convincing and user-friendly than asking to remember passwords. Moreover, outsourcing OTP services from providers eliminates the daunting task of managing an in-house OTP system. 

That too, if you care to choose a reliable OTP provider marketplace. To help you with the hunt, the above-curated list of OTP providers is an excellent choice for SMBs. However, make sure to choose a provider that suits your business needs.

You may also explore best SMS marketing platforms to engage with your users.

  • Archit Shukla
    Archit has over 04+ years of experience in content/copywriting and marketing. When he’s not crafting captivating stories, you can find him on the cricket pitch, hear him belting out tunes with his melodious voice, or move to the dance rhythm…. read more
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