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Applies to Product - Dynamics 365 Business Central


What’s happening?
Customers encounter authentication errors when setting up email accounts in Dynamics 365 Business Central for communication with external users.
 

Reason:
This is often due to misconfiguration of the email account or incorrect licensing. Specifically, the user may not have the appropriate Office 365 license assigned, such as E3 or E5, or the mailbox may be inactive, soft-deleted, or hosted on-premises.
 

Resolution:

  1. Verify that the user has the appropriate Office 365 license assigned (E3 or E5).
  2. Ensure that the email account is created and configured correctly in the Microsoft 365 Admin Center.
  3. If using a shared mailbox, confirm that the mailbox is active and not soft-deleted.
  4. Check that the user is a member of the relevant security group if security groups control access to the Business Central environment.
  5. Use the official documentation for setting up email in Business Central: Set up email in Business Central.
  6. After making the necessary changes, allow 30 minutes to 1 hour for propagation and then test the email setup by sending a test email to ensure it is functioning correctly.