The Growing Acceptance Of Voice-Activated Payments

This innovation has elevated customer experience to a previously untapped level

The world of FinTech has been a breeding ground for various revolutions and innovations; especially in the past decade. Near Field Technology (NFC), tokenisation, contactless cash withdrawals, offline payments are few such innovations that have improved customer expectations significantly and enabled many payment players to enhance their efficiency by leaps and bounds. One emerging trend that is taking the industry by a storm is Voice-activated payments.

With increasing need for convenience, voice-based devices i.e. virtual assistants have become the norm for many users in developed as well as developing economies. This innovation has elevated customer experience to a previously untapped level. Many users globally are accustomed to and rely on these devices to perform their day-to-day tasks. According to a survey, the number of people using digital assistants is estimated to rise up to 1.8 billion by 2021. Looking at the growing popularity and dependency on these assistants, many FinTech players are collaborating with tech-giants to offer payments and other financial functions to their customers using virtual assistants.

Backed by robust technologies such as Machine Learning and Artificial Intelligence, virtual assistants have made their way in to every possible device such as smartphones, wearables, speakers, light bulbs and even vacuum cleaners.

Why The Growth?

According to a report by PYMNTS, 60% of consumers now take issue with the act of shopping itself, finding it unproductive, inefficient, time-consuming and boring. Additionally, the pandemic has made us comfortable performing essential activities from the comfort of our homes. A technology such as voice assistant minimises human interaction, eliminates comparison or physical visits to the shops, thus elevating the customer/purchase experience.

Customers are looking for frictionless payment options and voice assistance is the ultimate frictionless method as the user does not even have to lift a finger. Voice banking was introduced in 2014 and since then many banks have hopped on to its bandwagon. Many leading banks such as ICICI Bank, Capital One, and American Express are already using this technology to provide hassle-free services to their customers.

As more and more people transact using their smartphones, integrating voice-tech to these platforms will make the process more convenient; it may immaculately outshine the traditional payment methods. Banks that adopt this technology will have the first-movers advantage and will be able to create a niche for themselves in the ever-evolving payment ecosystem.

Such an innovation will help many rural customers, especially in a country like India, to make transactions using vocal commands. This will eliminate memorising PIN codes as the transactions can be processed using their voice in any vernacular language. Solutions such as Voice Payment Systems (VPS) will aid in bridging the digital parity. Providing a regional vocal interface, banks can bring services such as balance enquiry, funds transfer, remittances, merchant payments, bill payments, loan repayments, insurance payments, govt. payments directly to the last mile.

Existing Challenges

While your voice is the most secure biometric that could be, using it for financial transactions is still considered a risk. Customers and banks are both hesitant to unleash this solution’s complete potential. There are certain flaws & glitches that were observed in many voice assistants which have made payment players reluctant towards a complete adoption. Also, voice assistants are yet to fully recognise the user’s voice, making it prone to attacks.

Improvements such as accurate voice-biometrics, enhanced voice-encryption, single-use voice token, and multi-factor authentication techniques will help users as well as banks in gaining confidence with such solutions.

The Road Ahead

The constant improvements and R&D will only make voice assistants more accurate to handle complex banking/financial transactions and functions. Additionally, the growing popularity will increase users’ reliance on such solutions for all their purchase needs, compelling technological players to constantly innovate. Personalised voice assistants will go a long way in helping brands (banks, in this case) to keep customers engaged and improve their satisfaction graph.

As interoperability becomes a reality in today’s payment ecosystem, it will be interesting to see the integration of a technology such as virtual assistant with the traditional banking system. In a nutshell, voice payments are set to be the next big thing and change the way we transact.


The author is Sunil Khosla, President – Digital Business, India Transact Services.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.