Paying With What You’re Saying

Paying With What You’re Saying

Paying With What You're Saying Using Voice-Activated Payments

Charles Keenan

Charles Keenan

Charles Keenan has written about payments since joining the American Banker as a staff reporter in 1997, a time when automated teller machines were appearing just about everywhere but people's living rooms thanks to the relaxation of surcharging rules.

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We've all experienced the frustration of epic fails with voice assistants, often leading to garbled words, misfires and misinterpretations of your original intent.

So can we trust these devices to understand our words in order to conveniently and frequently execute a payment?

While it's still early, the answer is yes.

In fact, things have come a long way since Apple’s digital assistant, Siri, hit the market in 2011. Since then, a steady stream of competitors has come along: Amazon’s Alexa, Google Assistant, Microsoft Cortana and Samsung's Bixby. Despite some occasional hiccups in dictation, accuracy has improved. And if there's any doubt the time has come for voice payments, consider how consumers are talking more to their phones, asking for directions, looking for a restaurant or dictating a text.

The State of Voice Pay

Amazon Alexa now allows customers to make re-ordering simple via voice commands. Apple has enabled Siri to support a vocabulary for starting person-to-person (P2P) payments by using voice functionality, now used by apps such as Square Cash and Venmo.

Large banks are taking small steps, adding voice capabilities here and there. Capital One Financial in March added voice-powered commands for Alexa users for checking balances and making credit card payments. Royal Bank of Canada (RBC) added Siri capability in early August for bill pay and P2P. And Barclays in the United Kingdom added the capability for customers in late August.

For RBC, Siri made sense as an initial platform: about half of its users have iPhones.

"There is a good, strong band of loyal Siri users within the Apple community," says Peter Tilton, senior vice president, digital at RBC. "So it was a logical thing for us to extend this capability to that group."

Advancements Change the Tenor

The nascent stage of voice payments comes after some big advancements in speech recognition technology. During the last five years, cloud computing has offered the processing power needed for reading the complexity of speech and voice. Software has become much better at understanding voice commands and converting them to more conversational-sounding speech.

Meanwhile, the shift toward smaller computing devices over the years has actually made it harder to click and tap while on the go. From desktops and laptops to smartphones and tablets, our devices are becoming smaller and less convenient for typing. While consumers might not make a payment via a touchscreen on an Apple Watch, they sure might want to use Siri to do it.

"As we move more toward mobile devices and microprocessors that are embedded in objects, voice is going to emerge as the interface," says Russ Jones, a partner at Glenbrook Partners, a payments industry consulting firm based in San Francisco.

Time to Tune In

For banks, it’s not really an option of when to start exploring voice payments. Soon they will become an expectation of consumers rather than a competitive advantage. Yet, the investment by banks in voice technology for consumers should also pay off in terms of reducing costs of in-branch visits and call-center calls.

Personetics, a New York-based firm that sells digital technology and artificial intelligence (AI) solutions to banks, is piloting chatbot software in the mobile apps of some of its customers. One of those banks has reported a 45-percent reduction in follow-up phone calls from customers who used a Personetics-powered bot to answer a question by voice command compared with those who used a Google-powered search to answer a question on the website.

Getting a banking app to process a voice command can yield dividends, by lowering the odds a human will be needed to answer a question. "Understanding natural language is a really big investment in reducing calls to the call center," says Ron Shalit, director of product innovation for Personetics.

The improvements in voice technology for apps are basically using interactive voice response (IVR), which call centers use to control customer flow and divert calls. Thanks to AI and computing power, IVR has become conversational. Now a customer can start out by saying "I'd like to transfer $500 to John Smith," with the system picking it up from there. And mistakes are more easily rectified — the customer could change the amount by saying, "No, send $600 to John Smith instead." The experience is faster and more fluid, Shalit says. "IVR use cases are all of a sudden very conversational experiences," he says.

Gains in Understanding

The advantage these conversational systems have is that they can understand the requests better, since the context of the conversation is solely financial services, Shalit adds. That prevents the banking app from mistaking "car" for "card" like it may if the conversation was broader.

Banks can also tap APIs of the big platforms, just like RBC, Capital One and Barclays have done. For RBC, going with Apple's Siri made sense. The bank hasn’t yet released statistics, but says that it has seen 'material volumes' for bill payments and e-transfers. Anecdotes include feedback from customers splitting checks by speaking into their iPhones. "That's a common use case we’re hearing about," RBC's Tilton says.

For voice payment purchases, there will need to emerge a common voice interface of sorts, much like how we've seen payment wallets emerge for web and mobile purchases, Glenbrook's Jones says. Amazon no doubt has a leg up here with Alexa. Yet for the rest of retailers, having uniform ways to interact will be key.

And until then, expect to see consumers speaking up to make their payment experience more convenient than ever.

The statements and opinions of the writer do not necessarily reflect those of TSYS.

Other Articles by Charles

Charles Keenan

Charles Keenan has written about payments since joining the American Banker as a staff reporter in 1997, a time when automated teller machines were appearing just about everywhere but people’s living rooms thanks to the relaxation of surcharging rules.

His work at the American Banker included writing about credit and debit cards, merchant processing, and bank stocks. He later freelanced for the Banker and industry publications such as Banking Strategies, Bank Director, Community Banker, and U.S. Banker. He also writes about investing, insurance and health care, and is based in Los Angeles.

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