How Voice-Based Payments Can Transform India’s Digital Payment Space

The pandemic has accelerated a significant shift in the financial services industry. Payments are at the heart of this transition, given the importance of digitisation in the financial lives of an increasing proportion of the global population. As the number of cashless transactions grows, the industry’s responsibility to promote inclusivity grows in importance. Payments are not only a stable foundation for our digital economies, but they also contribute to their growth and innovation. 

Whether it’s using a QR code to pay for groceries or simply tapping your phone at a sales terminal, we had already shifted to digital payments before the pandemic. The volume of cashless payments, however, was highest during and after the pandemic.

According to a PWC report, global cashless payments will increase by 80% between 2020 and 2025, nearly tripling by the end of 2030. According to the analysis, the Asia Pacific region will experience the highest growth, followed by Africa, Europe, Latin America, the United States, and Canada. Such figures indicate the potential for global growth in the cashless segment. 

The transition to a cashless economy conceals a larger, more significant transformation. Traditional payment methods, such as the humble paper check and analogue invoicing, are not only changing dramatically, but the entire payment infrastructure is changing as new business models emerge.

This reshaping is driven by two parallel trends. The first is an evolution of the front and back ends of the payment system (instant payments, bill payments, request to pay, plastic cards, and digital wallets). This is accompanied by a revolution that involves fundamental structural changes to the payment mix and ecosystem (the emergence of “buy now, pay later” offerings, the development of central bank digital currencies, and so on).

Where Do Voice-Based Payments Stand In An Evolving Fintech Industry? 

Consumers across industries are becoming more interested in voice assistants as tech titans such as Google, Amazon, and Apple release AI-enhanced devices with conversational voice interfaces. These voice-enabled digital assistants have covered almost every aspect of mobile technology, from setting reminders to checking the weather to purchasing. As a result, the lateral movement of voice technology to payments should come as no surprise. 

What began as a way to interact with clients and answer their questions has now expanded to include transactional banking and payment services. Voice-based payment solutions are enabling the development of next-generation consumer experiences. 

For instance, the online payment gateway hasn’t changed much. Although it is a legal method, it requires ongoing IBAN and account number verification as well as app-to-app linkage. However, for voice payments, you simply speak to your phone, earpods, or a voice assistant to complete the desired financial transaction without using a PIN.  Your voice authenticates transactions and authorises payments.

Furthermore, voice payments are expected to level the playing field by eliminating the requirement for digital literacy and awareness as entry barriers to the burgeoning online payments industry. A user with any mobile device, feature phone, or smartphone can use a voice system to complete transactions by speaking on an IVR-enabled call-based payment system. It is as simple as dialling a phone number.

Is Voice-Based Payment The Way Of The Future?

The answer is a clear yes! The introduction of voice-based payments benefits two customer groups. One who lives in urban India is familiar with emerging technologies. This consumer already uses Alexa or Siri and is comfortable with UPI payments.  The use of voice payments will bring them to the next level of customer experience. Something secure, comfortable, and convenient to use. 

The other customers for whom voice payments have enormous potential are in rural India. Individuals who use a feature phone or are technologically challenged.  Voice payments are a digital payment solution that works across all devices, including smartphones and feature phones.  With the help of this cutting-edge technology, half a billion feature phone users may be able to participate in the world of e-payments.

With the introduction of the UPI in 2016, a new era of digital payments began. Though slow at first, it now accounts for 50% of retail digital payments and is nearly 4.5 times the volume of debit and credit card transactions. And now we live in a world where even the most unsophisticated fruit vendor on a cart accepts UPI payment. A lot is going on in the payment industry, so much so that many industry experts believe the payment sector is entering a new era of payments 4.0, and it is safe to assume that ‘Voice’ will be a critical component of it.