Voice biometrics and fraud prevention in payments

By Claire de Koeyer and Jim Bulling

The ability to transfer funds from one account to another in near real-time using just an email address or mobile number is getting closer for Australians with the RBA advising that developments are on track to allow the first payments to be made through a new payment platform towards the end of 2017. The new platform, the development of which was commenced by the RBA in 2012, allows for near real-time funds transfer between bank accounts, regardless of who people bank with.

In most payment systems, banks typically have time to uncover fraud and stop the transaction from being processed but where instantaneous settlement processes are involved, banks may not have this luxury.

The implementation of voice biometrics is one way to identify and authenticate an account holder and may act to reduce the rates of fraud which may accompany new payment systems.

Australian and New Zealand managing director of Speech software company Nuance, Robert Schwarz, acknowledges there is an important place for voice biometrics in reducing fraud that could emerge in an instant payments environment.

ANZ have indicated they propose to introduce voice biometrics to its mobile banking system in a bid to improve security on high value transactions. In partnership with Nuance, this system is set to launch from mid-2017. The proposal is that customers transferring more than AUD$1000 through a mobile app of ANZ will be able to use their voice to automatically authorise high value payments. This promotes both more secure transactions and more efficient security checks.

Schwartz is of the view that “conversational commerce” is the direction the banking industry is headed.