Are voice payments ready to find their voice?

By Jeff Domansky, Oct 29, 2020

New developments and improvements in voice technology are already driving customer service, bot automation, and even investments in the banking and payments world.

Juniper Research estimates that over 4.2 billion digital voice assistants are in use on devices worldwide – a number that is projected to double to 8.4 billion by 2024. That’s more than the population of the world.

There are now an estimated 110 million virtual assistant users in the United States alone. Most smartphone users have used voice search technology either on their device or when interacting with any number of companies for customer service and other purposes.

Advances in Machine Learning (ML), Artificial Intelligence (AI), and neural language processing (NLP) have enabled voice assistants to become commonplace at home, in cars, and in the workplace.

Who’s already using voice payments?

According to a Nov 2017 Capgemini report, 28% of US residents say they had already made payments or sent money using only their voice. Consumers can make voice payments or send money through popular payment apps including Venmo, Square Cash, or PayPal.

Among consumers in the US, UK, France, and Germany, Capgemini also found 81% have used voice assistants via a smartphone (eg, Siri, Cortana, Google Assistant), 28% used it via a smart speaker like Amazon Echo or Google Home and 21% have used it on a screen-based device other than phones such as Amazon Echo Show and Amazon Fire TVs.

voice search is leading to voice payments

SDK.finance said American Express, CaixaBank, Nationwide, Royal Bank of Canada, United Services Automobile Association, Barclays, National Australia Bank, HDFC Bank, Banco Bilbao Vizcaya Argentaria, and Oversea-Chinese Banking Corporation have been integrating Siri, Alexa, Google Assistant, and other voice-enabled home devices into their banking ecosystems so that customers can use their apps via voice commands and make different financial transactions.

According to PwC in its report 3 billion reasons voice can transform banking, digital-only bank customers are the least satisfied customer in all of retail banking.

“The financial services industry is addressing the one-click, on-the-go behavior of consumers. The availability of payments is widely embedded in mobile phones and has become a highly convenient payment method, especially when tied to the activity itself (e.g., ride-sharing or meal payment). Chatbots have also become popular as banks look to refine their approach to the customer experience by providing a natural way for consumers to get information when and where they want.”

PwC lays out a key strategic positioning where industry leaders will need to “Transform the entire value chain with voice to deliver financial solutions rather than a financial product.”

$3 billion in annual cost rationalization opportunities exist in the US alone, from just the redirection of rudimentary customer information requests according to the global consulting firm.

“The average time spent on basic inquiries (balance requests, transaction status updates, address changes) typically occupies just over half (52%) of total call center time. That, combined with branch employee reduction (5% to 10%) from voice handled account openings or transaction questions, could result in about $2.8 billion in annualized industry cost reductions.”

Consulting firm OC&C Strategy Consultants predicts the value of voice-based payments will jump from $2 billion in annual payment volume in 2018 to $40 billion in volume by 2022. The pandemic may very well have thrown those projections out the window in favor of even faster growth.

The top categories for voice shopping in 2018 were grocery (20% penetration of voice payment users), entertainment (19%), electronics (17%), and clothing (8%). Imagine how these numbers have grown during 2020.

Voice services and voice payments are critical components to better service, happier customers, higher engagement, profitability, and future growth. Even as e-commerce has grown tremendously during the COVID-19 crisis, in a post-pandemic world we expect voice payments to become an even more important part of the financial services landscape.

You can read more about voice payments in this recent article by SDK.finance or on the company’s website.