Banks are trumpeting their use of voice recognition technology in a way not seen before, using it to demonstrate their innovation credentials and customer centricity. Joy Macknight looks at the ways in which it is being utilised.

In February 2016, HSBC announced that it was making voice authentication available to more than 15 million HSBC UK and First Direct customers by the end of the third quarter of the year, making it the largest roll out of this type of biometric technology in the UK to date.

Instead of verifying a customer through a traditional password or PIN, their voice is assessed against more than 100 indicators from behavioural measures, such as cadence and pitch, to physical measures, such as the size of their larynx and vocal tract.

“Everyone’s voice is unique – something we are now able to use to the customer’s advantage,” says Nadya Hijazi, the bank’s global head of e-commerce, payments and cash management.

Body language

While there is nothing wrong with the legacy system for verifying customers, according to Ms Hijazi, the bank wanted to introduce more convenient and secure authentication methods for customers who use telephone, online and mobile banking, “using the most secure form of password technology – the body”. Together with voice biometrics, the bank is rolling out Touch ID, Apple’s fingerprint recognition sensor.

HSBC’s move seems to chime with consumer sentiment in the UK. New online consumer research findings from YouGov found that more than one-third (37%) of people agreed that traditional passwords are outdated and 74% believed the body will become the default password of the future.

The bank’s customers will have to enrol to use the voice authentication service. Once registered, they will simply use their voiceprint to verify their identity for subsequent telephone banking calls.

The technology has advanced far enough that illnesses, such as a cold or sore throat, should not be an issue, as it not only measures sounds but also the way a customer’s muscles produce sound, according to Ms Hijazi. However, in cases where a customer’s voice is severely impacted for medical reasons, the bank will use an alternative method to verify their identity.

Following the UK implementation, HSBC is planning to roll out the technology to customers in Hong Kong, Mexico, Canada, the US and France. In addition, the bank is looking at voice and other forms of biometric authentication, including fingerprint recognition on mobile devices and facial recognition for corporate customers.

Driving adoption

While many banks have been exploring biometric technology for more than a decade, Sebastian Reeve, director of product management and marketing for Europe, the Middle East and Africa (EMEA) at Nuance Communications, believes that what is different today is that “the size of the problem of remembering passwords has gotten bigger – now to the point where there is a wave of pressure to address it”. Nuance provides the voice biometric technology for HSBC, as well as many other banks.

“In addition, the competitive nature of the industry as a whole – and the need to differentiate – is driving a lot of the early adopter activity. Big banks are going to press in a public way on behalf of their customers,” adds Mr Reeve.

Clive Bourke, president, EMEA and Asia-Pacific at biometrics identity firm Daon, which recently announced a deal with UK challenger Atom Bank, believes that the increased noise around launching voice biometric solutions is due to banks trying to re-establish in the minds of their clients that they are easy to do business with, particularly as they come under increasing pressure from the fintech start-up community.

“Authentication seems like a sleepy, boring, less relevant aspect of the customer experience, and previously most banks would have thought that a customer would tolerate a little inconvenience as a trade-off for security. But the truth is customers that aren’t thinking like that anymore,” he says.

“The banks have woken up to the fact that friction during authentication, whether through mobile banking or a call centre, is having a significant impact on client experience,” he adds. “For example, a bank that uses Daon’s IdentityX platform, and is known to have an award-winning customer experience, found that up to 40% of its net promoter score [NPS] was related to authentication alone.

“Now banks are broadcasting the fact that they are using voice biometrics for various purposes including call centres, general access and ‘step-up’ authentication within mobile banking, etc.”

Talk is cheap

Voice authentication has an advantage over other biometrics in that it does not need special devices for data capture. “Technologies to collect a voiceprint are ubiquitous – even plain old landline telephones are more than adequate to obtain a voiceprint, anything with a microphone really,” says Mr Reeve.

And while voice technology has improved, according to Mr Bourke, so has the supporting technology – for example, G4, smartphones, mobile apps, etc. Alan Goode, managing director at analyst firm Goode Intelligence, makes a similar point. “There has been a big improvement in voice quality at the capture stage and we have also seen improvements in algorithms and machine learning on the server and cloud side to ensure quicker and more accurate processing,” he says.

Many banks are using the technology to prove their thought-leadership and innovation credentials in the marketplace. “This is even truer now that HSBC has made its announcement,” says Mr Bourke. “It is time to catch up.”

Ahead of the game

Although HSBC’s voice biometrics deployment is now the largest in the UK, previously Barclays held that crown. Barclays has been using voice authentication technology since late 2012. It began by implementing the technology in its wealth and investment management arm for high-net-worth individuals; then announced it would introduce voice biometrics to its 12 million retail customers in 2015.

Barclays also uses a passive model of voice biometrics, where the technology listens to the conversation and evaluates the customer’s voice against a previously enrolled voiceprint. “The conversation is fluid – there is no defined text being spoken, no key words, no passwords, just the voice characteristics,” says Mr Reeve.

Using a Barclays Wealth and Investment Management example, a wealth manager will be alerted to whether the customer has been authenticated or if further security questions are needed. According to Mr Reeve, 95% of the time clients are correctly identified within 15 to 20 seconds.

“The conversation is very different because it immediately starts with what the client wants, rather than with a number of things they have to say before they can start talking about what they want,” he says.

Its African subsidiary, Absa Bank, deployed voice biometrics for private banking clients at the end of 2015. Absa faced two deployment challenges: obtaining in-depth knowledge of the technology, and ensuring risk compliance as well as alignment and compliance with South Africa's Protection of Personal Information Act. The global Barclays team shared its experiences, which aided the roll out “immensely”, according to Penny Futter, chief information officer for retail and business banking at Barclays Africa Group.

From inception to roll out took nine months, including eight weeks of testing and a four-week pilot. The first implementation was with private bankers in August 2015 and then a month later with private bank and wealth customers. Asa Bank is now planning to roll out to other customer segments.

“Our customers have a choice of multiple channels, including mobile, online, telephone and face to face. Technology like voice biometrics is therefore critical to ensuring that we ‘know’ our clients at all touch points,” says Ms Futter.

Defining a use case

As illustrated by Barclays, many banks start with a specific client, service or geographic segment. One of Daon’s top tips for rolling out a biometric authentication solution is to find a good use case.

When Slovakia’s Tatra banka began looking at voice biometrics more than four years ago, it identified two specific use cases. First, it wanted to transform its call centre from a cost centre to a profit centre by making it sales oriented. Its research found that the process of call-centre authentication was cumbersome with many security measures, which resulted in incoming traffic halving between 2008 and 2012.

Second, it wanted to introduce remote relationship management for affluent customers. “It is frustrating for customers with a personal banker to spend the first 90 seconds of a call authenticating themselves – it doesn’t make for a good relationship,” says Peter Mažerik, head of communications and brand strategy at Tatra.

Tatra used its branch network as the key channel to record voiceprints. The marketing campaign started in August 2013 and the bank had almost 40,000 recordings within a couple of weeks; today it has more than 300,000.

The bank reduced the time to authenticate a client by almost 70%. “Now call-centre staff can spend time with clients on more useful things,” says Mr Mažerik. Not only has the bank stopped the decline in calls to the call centre but has managed a small increase.

“We can say that the call-centre transformation, from a sales point of view, is a success. Also, clients using voice biometrics assess it positively in terms of NPS and it helps the bank’s image as an innovator in the market,” he adds.

A Canadian experience

Similar to Tatra, Royal Bank of Canada (RBC) wanted to revamp its call-centre experience to improve client engagement. Its research showed that the time spent authenticating clients took away from the personalisation of the service. RBC’s Secure Voice biometrics service was launched in October 2015 and is used for telephony with a live adviser.

RBC also went for the opt-in method, where clients agree to enrol on the service. Claude DeMone, vice-president of contact-centre technology who led the Secure Voice initiative, says: “If clients opt in, then the enrolment process happens and consists of nothing beyond them continuing their conversation with their adviser. The next time they call, they are authenticated within a matter of seconds as they speak with an adviser in real time.”

Like Barclays Wealth and Investment Management, RBC chose the passive method. Authentication takes place in the background, “delivering a much better client experience from our perspective”, according to Mr DeMone.

When the bank put together the proof of concept with Nuance last year, it tested for two things beyond security: how well the client base accepted the solution, and how well it was received by employees in terms of ease of use and intuitiveness.

Mr DeMone says: “It was well suited to our client base, our employees loved it and it met all requirements from a security perspective, so we decided to roll it out to a wide range of our businesses in Canada.” The acceptance rate is about 95%, which exceeded expectations. Currently the bank has more than 500,000 clients enrolled.

Like Mr Mažerik, Mr DeMone sees value in being at the leading edge. “From a competitive advantage perspective, our primary focus was making it easier for our clients and providing a great and secure experience,” he says. “As a result of this project, clients have trust in RBC and know that they are doing business with a company that is innovative.”

Leading in India

On May 25, 2015, ICICI Bank became the first bank in India to launch voice recognition for biometric authentication. The bank’s first use case was aimed at allowing its clients to execute banking transactions through ICICI’s telephony channel. The scale of the roll out dwarfs previous examples – ICICI’s voice recognition service is available to 33 million savings account customers.

Saurabh Singh, senior general manager and head of customer service quality group at ICICI Bank, says: “Customers are no longer required to enter their card numbers, PIN and answer security questions to authenticate themselves. Their voice will now act as the password for banking transactions through the call centre, when they call from their registered mobile number.” If customers call from a non-registered number, then they will have to go through the traditional verification process.

The bank’s internal research showed that the complex verification process led to customers having to go through multiple attempts to reach the bank. “We wanted to offer them a technology-led solution that would provide exceptional customer experience while offering a secure and hands-free alternative to the traditional on-screen commands on smartphones,” says Mr Singh.

Since launching the voice recognition system, the bank has seen an 80% time reduction to reach a bank adviser – on average just 10 seconds. Additionally, it has increased staff productivity. ICICI Bank is now planning to widen the scope and implement voice biometrics across multiple channels of banking, i.e. mobile, internet, branches and ATMs.

Mobile in the US

US Bank’s work on voice biometrics started a few years ago when the technology was out but still emerging. Still, it was the only “viable” solution, says Dominic Venturo, chief innovation officer at US Bank, as most clients had mobile phones – not even smartphones at that stage. The bank was involved in early experiments where the success rate just was not high enough for the commercialisation.

“With the pilot work we did a year ago we were able to attain very high performance levels, enough so we were confident that we could put it into production,” says Mr Venturo. US Bank rolled out voice biometrics in its mobile banking solution for consumers and small businesses in 2015. “Within the bank’s mobile banking app we have a ‘step up’ authentication, so additional authentications steps for certain transactions,” adds Mr Venturo.

One of the biggest challenges he faced was changing the authentication models within existing technology. “Whenever you are implementing a new technology that didn’t exist when others were created, then you have to determine how to integrate those within the services,” says Mr Venturo. “Fortunately our technology organisation had designed systems able to do things like single sign-on across multiple platforms, so from that perspective it wasn’t a giant build.”

Interestingly, the experience helped the innovation team to think differently about future authentication technologies that do not yet exist. “When the next one comes along we are in a well architected position to be able do that,” says Mr Venturo.

Speech recognition

Authentication is not the only area of voice recognition that is making headlines. In addition to 'speaker' recognition, or voice biometrics, there is speech recognition – an area where Nuance built its reputation as the technology behind Apple’s Siri.

“These are the two central pillars of what we do – understanding what is said, speech recognition, and understanding who said it, in terms of voice biometrics or speaker recognition,” says Mr Reeve. Nuance uses machine-learning techniques to power both speaker and speech recognition, although the underlying technologies themselves are quite different. “Deep neural networks, deep learning – these techniques are also at the heart of biometrics, as well as driving improvement in core speech recognition and language understanding technology,” he adds.

Nuance is behind Santander’s recent launch of 'voice banking' in the UK. The bank’s customers will be able to talk to the SmartBank app and ask simple questions about their card spend.

“Voice is the most natural way we interact and with a growing number of customers using mobile devices, Santander merged the two experiences to create a quick, simple and secure hands-free option for customers who want to manage their money on the move,” says Ed Metzger, head of innovation, technology and operations at Santander.

The technology is being rolled out in two phases. The first is an introductory phase aimed at helping customers get to grips with the basic features. The second, due for release later this year, will enable customers to more fully service their accounts, including the ability to make payments.

Mr Metzger believes that the industry as a whole needs to do more to educate consumers about the technology. “Although most people use their voices every day to communicate, there’s a step that needs to be taken in recognising that people can use their voice to communicate with technology to also carry out tasks and enhance their lives. We’ve seen the likes of Siri and Nina [Nuance] take off, but more needs to be done to help everybody realise its potential and capabilities,” he says. “People don’t always understand that with this technology it becomes more intuitive the more you use it.”

While Santander UK is not currently using voice biometrics, it is an area that the bank is looking at closely. However, the Santander Group as a whole has some experience in voice biometrics – Banco Santander México deployed Nuance’s technology to 1.7 million customers in May 2014.

ING's double take

ING Netherlands is an example of a bank that is deploying both technologies: it launched Nuance voice biometric technology as means of authorisation of payments in June 2015, following its roll out of a digital assistant feature, called 'Inge', in September 2014.

An ING spokesperson says: “Voice biometrics is also a step-up to more voice interaction within the banking app. The use of this will increase in the years to come we think. It will be much more a digital assistant, in the way young people today use Siri and voice-operate YouTube and Google.” ING is convinced that the technology will improve dramatically in the coming years, which might open up possibilities to use it more intensively for products and services.

Mr Reeve is beginning to see more examples of these two technologies coming together. “Just from a usability perspective, if you logged in with your voice then you are more likely to request what you need with your voice. On that basis, they are seen as a natural fit and deployments in certain institutions have gone to that level,” he says. He is expecting more to follow.

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