Voice-enabled and Artificial Intelligence-powered devices have taken the tech world by storm already. With advancements in technology, virtual assistants are becoming more and more intuitive with each passing day.

The increase in accuracy has resulted in heavy demand for digital assistants across the globe.

According to a survey, the number of people using digital assistants is estimated to rise up to 1.8 billion by 2021. Furthermore, 54% of the total users with access to voice-enabled assistants have agreed that they use them at least once daily, while 65% people have agreed that the digital assistants have an array of uses.

The advent of virtual assistants has resulted in consumer expectations to skyrocket

Users have grown accustomed to instructing digital assistants to perform their tasks. Noticing the ever-increasing popularity of digital assistants, a huge number of financial institutions are either offering their own voice assistant or have tied up with tech giants like Amazon or Google to provide seamless services to their clients. The assistants are expected to make payments and perform other financial functions as and when instructed by a user through vocal commands.

Importance of Voice Payments

Leveraging conversations to provide financial services may sound complex. However, voice payments offer banks and other financial institutions an opportunity to capitalise on the idea of creating their own brand identity. Virtual assistants can be built in keeping with the brand identity of institutions and can provide personalised services depending on a user’s profile. The personalised user experience is key to encouraging loyalty and paves the way for making new profitable acquisitions.

The current crop of assistants are being used for the following purposes:

• Users can use voice payments to transact money to a friend or acquaintance using the peer to peer network. The companies that allow these transfers are Venmo, Square Cash, and Paypal.
• Amazon’s Alexa can be used to buy things online, place an order at Starbucks and also can be instructed to pay a users Capital One credit card bill.
• Google Assistant is enabling customers to shop from nearby stores online.

All these trends point to the growing popularity of voice-enabled payments in the foreseeable future. Some of the most popular banks such as ICICI, Capital One, American Express have already tied up with either Alexa, Siri, or Google assistant to provide hassle-free services to their customers. Other institutions like Santander Bank, Bank of America, Ally Bank, and Garanti Bank have gone a step ahead and created their own virtual assistants for their consumers

The Drawbacks of Voice Payment Systems

Like any other budding technology, voice payments have their own set of problems associated with them. The biggest concerns that have hindered the adoption of voice payments are security and privacy.

The problems came to the fore when certain critical Bluetooth flaws exposed security loopholes in millions of AI-powered devices including Amazon Echo and Google Home. Furthermore, an increase in the number of CNP or Card Not Present frauds have questioned the effectiveness of the voice payments system.

Also, the voice assistants have not yet mastered how to identify voices accurately enough to prevent cybertheft. It has often been observed that virtual assistants are triggered accidentally and offer unauthorised access to payment facilities.

The absence of a fail-proof authentication system is being inspected carefully by innovators around the world. Suggested improvements to overcome the shortcomings include accurate voice-biometrics, enhanced voice-encryption, single-use voice token, and multi-factor authentication techniques.

Future of Voice Payments

With continuous advancements in technology, digital assistants are only expected to become increasingly accurate and sophisticated. The virtual assistants are on the way to shun the title of scripted machines and don the role of a reactive listener which will anticipate a user’s needs and offer the most appropriate recommendations.

With the increasing demand for interoperability, it won’t be a surprise if popular voice assistants were to come together and work in association with each other. All in all, the voice payments system seems to be heading towards the top and is expected to change the face of the financial services offerings around the world.