RCS challenges SMS dominance in business messaging

Rich Communication Services is moving from innovation to mainstream.

The future of business messaging may no longer rest with SMS. Rich Communication Services (RCS) is rapidly gaining ground, promising richer customer experiences, higher engagement rates, and stronger security — a combination that is turning it into a credible challenger to the decades-old text format.

“RCS for business is a pretty strong channel for businesses to communicate and engage with customers,” said Neil Patwardhan, Senior Vice President, Sales, APAC at Sinch. He added that adoption is now scaling across regions, as Google, Apple and telecom operators integrate the technology. “It brings almost WhatsApp-like functionality in terms of driving conversation between brands and consumers across a variety of different use cases, from marketing to customer care to operational alerts.”

For Amrat Singh, Director at CUTS International, the shift is structural. “RCS is seen as game changing because it transforms traditional SMS into a rich, interactive and branded communication channel, and that also all within the phone's native messaging app,” he said. Unlike SMS, he added, RCS supports “images, video carousels, quick reply buttons and tap to action features,” offering businesses app-like experiences without requiring customers to download new platforms.

Adoption has been fastest in sectors where communication is frequent and time-sensitive. Patwardhan pointed to retail and e-commerce using RCS for marketing campaigns and package tracking, while Singh cited banking, travel and telecoms, which have reported “20-30% higher click through rates in detail promotions and faster adoption of digital boarding passes in the travel industry, and then improved fraud prevention engagement in banking.”

The engagement uplift is significant. Patwardhan said one European client saw “a 42% increase in customer engagement… three times higher in terms of the click rate and a 10% increase in redirections.” Singh noted that “RCS campaigns consistently achieve click through rates that are three to 1010, times higher than SMS, because customers can browse, confirm or even complete a purchase directly within the message.”

The long-term issue, however, is whether RCS can truly replace SMS at scale. Analysts forecast the RCS market could exceed US$25 billion by 2030, powered by AI-driven personalisation, embedded payments, and enhanced fraud protection.