Hey folks! I'm looking for some guidance on setting up a test environment for my company's ERP application, which I'll refer to as D. This app sends out automated emails like payroll info every month, and it runs on our clients' servers that use Microsoft domains. Recently, Microsoft has started phasing out SMTP authentication in favor of OAuth(2), so we need to update our app to accommodate this change. My task is to create a test tenant so our developers can try out the new setup. We have a Microsoft 365 business account, but I'm not sure if I just sign up for Entra ID P1 or P2 and it'll all fall into place. Does anyone have tips on how to proceed? Thanks!
3 Answers
You can definitely create a tenant and set up an SMTP relay on a Windows Server 2019 if you want to go that route. Alternatively, you could use Entra with an OAuth app for your ERP. Just remember to use Azure Vault to store the secret key securely instead of hardcoding it. Something like Mailgun might also be a good choice and could be more cost-effective than Entra.
Honestly, I'd avoid using Microsoft for transactional emails. They tend to kick accounts off for spam easily. I suggest switching to a third-party service like SMTP2GO; they even have a free tier that should work well for your needs. It's pretty straightforward for your developers and clients to integrate.
Using a third-party SMTP server like SMTP2GO is a solid idea. You can simply point your app to this new SMTP endpoint and you should be good to go! If you're looking for a test tenant, there's a Microsoft developer program that gives you access to free testing tenants. Check out their Dev Center for more info.

I get that an SMTP relay could just be a temporary fix. Is Mailgun like a completely different platform? And about this secret, will I find it after registering my app on the Entra page?