SMTP with OAuth 2.0 in Business Central: A Modern Email Setup

Email remains one of the most critical communication tools in Business Central. Whether you’re sending invoices, notifications, or workflow approvals, the reliability and security of your email integration matter. With Microsoft officially retiring Basic Authentication in Exchange Online, Business Central users must now embrace OAuth 2.0 for SMTP connections. Let’s explore what this means and how to configure it.

Why the Shift to OAuth 2.0?

• 1. Basic Authentication is deprecated: Microsoft disabled it across all tenants, meaning username/password SMTP connections no longer work.
• 2. OAuth 2.0 is token-based: Instead of storing passwords, Business Central uses secure tokens issued by Azure AD.
• 3. Compliance and security: OAuth aligns with modern identity standards, reducing risks of credential theft.

Setting Up SMTP with OAuth 2.0 in Business Central

The process is simpler than many expect. Here’s the streamlined approach:

1. Navigate to Email Accounts
   • a. In Business Central, search for Email Accounts.
   • b. Choose Add an email account.
2. Select SMTP Connector
   • a. You’ll see options like Microsoft 365 Connector, Current User Connector, and SMTP Connector.
   • b. Pick SMTP Connector if you want to use your mail server directly.
3. Apply Office 365 Server Settings
   • a. Business Central can auto‑populate server details for Office 365.
   • b. Authentication type must be set to OAuth 2.0.
4. Enable Authenticated SMTP in Microsoft 365 Admin Center
   • a. Go to Active Users in the Microsoft 365 Admin Center.
   • b. Select the user (often the administrator).
   • c. Under Mail → Manage email apps, enable Authenticated SMTP.
   • Save changes.
5. Test the Setup
   • a. Send a test email from Business Central.
   • b. If configured correctly, the email will be delivered securely using OAuth 2.0.

To conclude, switching to SMTP with OAuth 2.0 in Business Central is not just a technical requirement it’s a strategic move toward secure, modern communication. The setup is straightforward, but the payoff is significant: stronger security, smoother compliance, and reliable email delivery.