What Constitutes 2FA OTP Phone Verification Cost?

RingCaptcha is not the ‘cheapest’ phone identity and voice/SMS verification provider price-wise, when you choose our full offering. We don’t intend to be. Instead, we aim to be the most cost-effective. Because of that, overall, we are still the ‘cheapest’ phone verification provider when you take into consideration customer lifetime value, fraud, and maintenance cost.

Customer Lifetime Value (LTV)

LTV can be defined as the business value of a customer over the period she remains as a customer. The LTV is usually a few magnitudes larger that the cost of a single one-time PIN (OTP) used for phone verification.

The overwhelming difference of LTV over OTP cost justifies paying for a phone verification service that ensures you do not lose a potential customer due to disruption in the phone verification process.

RingCaptcha are experts in phone verification conversion; we provide a holistic solution that covers multiple facets of phone verification, i.e., UI, provider/route fallback, followup OTP, AI-assistance, and customer support dashboard, to smooth over potential issues (system failures, user errors, etc.) that hinder a potential customer from completing the phone verification process successfully.

Compare our phone verification single API call with most of the run-of-the-mill providers’ API side-by-side.

phone verification
Compare RingCaptcha True Single API vs. other phone verification provider API

For run-of-the-mill phone verification providers, they will attempt to send the OTP, and then report whether deliverability is successful. There are no mechanisms to enhance the phone number verification conversion rate.

2FA OTP Phone Verification Best-Practices

For RingCaptcha, we baked phone verification best-practices into the UIs of our SDKs, which are available for both websites, or mobile native apps. For example, Blink is an Android-based touch-free technology where we verify a phone by merely making a short sub-second call that does not require any action on the user’s part. This UI enhancement eliminates the likelihood that a user keys in a wrong OTP or forget to use the OTP, which disrupts the phone verification process.

RingCaptcha is a high-availability service, with infrastructure that runs off multiple physical sites, and sends SMS/voice OTP through more than 10 different providers that it has direct business relationships with. This guarantees that there is a fallback path for non-correlated failures in any provider or carrier.

Moreover, if a phone verification does not convert, RingCaptcha will trigger a follow-up OTP through a different provider, and a different channel (SMS/voice).

If a phone still does not convert, the AI-assistant will call the user to ask a few questions and determine why the user is not converting and alert customer support if required.

Finally customer support has access to a phone verification dashboard, which flags out, in real-time, distressed users who cannot verify their phones.

Fraud Cost

As your service becomes popular, it will attract shady users, and even inexplicable attacks. Shady users will try to game your discount or incentive systems for their own benefit, which is detrimental to the user community, and your revenue. Inexplicable attacks just rack up your phone verification costs, such as requesting many OTPs; the malicious actions do not directly benefit the attacker herself.

When you request RingCaptcha to verify a phone number, besides the conversion rate optimization features mentioned above, the request also enjoys our in-built fraud protection; our dynamic blacklister will block OTP requests from phones with a high threat-level score. We monitor more than 50 phone activity data points, more than 30 open sms sites (and counting),  and phone verification conversion rates to feedback into the phone threat-level scoring system.

Without proper fraud protection, your ‘cheap’ phone verification provider will ultimately turn out to be painfully expensive.

Maintenance Cost

If you are convinced that high phone verification conversion rate, and fraud protection are necessary to make phone verifications cost-effective, you may be tempted supplement your ‘cheap’ phone verification provider with additional services. However, the initial and continuous maintenance effort and cost should make you think twice.

To achieve the same fallback/followup effectiveness as RingCaptcha, you would need to maintain relationships/accounts with multiple providers, and integrate with multiple API endpoints for each of them. For protection against fraud, you would need to maintain a separate fraud analytics vendor account. Continuously monitoring conversion rates, selecting the best provider for each phone number verification, and routing over temporary provider/carrier failures are additional challenges that you will face. Those are just the tip of the iceberg of things necessary to operate a smooth running phone verification service.


Your ‘cheap’ phone verification provider may not be that cheap after all if you look at phone verification cost from the complete business level perspective, which considers customer lifetime value, fraud and maintenance cost. Chat with a phone verification conversion optimization expert today through our live chat at RingCaptcha.


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