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Mobile wallets

6 chatbot payment innovations

By Penny Crosman
About Penny
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penny.crosman@arizent.com
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, Daniel Wolfe
About Daniel
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daniel.wolfe@arizent.com
daniel-wolfe-5947087
, John Adams
About John
johnhadams
john.adams@arizent.com
john-adams-83444310
and Kate Fitzgerald
About Kate
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kate.fitzgerald@arizent.com
https://www.linkedin.com/in/kate-fitzgerald-0148723
Published February 10, 2017 8:22 AM
1 Min Read
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As chat technology advances, making a purchase could be as easy as typing "Buy, Robot." Several banks and fintech companies are developing ways to advance chatbots for commerce and customer service.

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As chat technology advances, making a purchase could be as easy as typing "Buy, Robot." Several banks and fintech companies are developing ways to advance chatbots for commerce and customer service.
PayPal at 2020
Attendees visit the PayPal booth at the Money 20/20 conference in Las Vegas, Nevada, U.S., on Tuesday, Nov. 4, 2014. The conference, which includes over 100 sessions and 500 speakers, explores the evolution of payments and financial services and the innovations that are driving trends in the mobile, retail, marketing services, data and technology sectors. Photographer: Jacob Kepler/Bloomberg
Jacob Kepler/Bloomberg

PayPal and Slack

PayPal recently unveiled its first chatbot, which runs on Slack, a chat platform used in offices. By focusing on P-to-P use cases in a business setting, PayPal's strategy somewhat echoes the beginnings of the hugely popular Starbucks payment app in 2009. In the Starbucks app's early days, it focused on selling to office workers picking up their morning coffee on the way to work. This meant prioritizing development for BlackBerry handsets — still a staple of office life at the time — over the common Android platform.
Slack's Ceci Stallsmith, head of platform marketing
Ceci Stallsmith, head of platform marketing at Slack Technologies Inc., speaks during an event in San Francisco, California, U.S., on Tuesday, Jan. 31, 2017. Slack Technologies Inc. launched Slack Enterprise Grid, a new product designed to help its software scale to organizations with tens of thousands of employees. Photographer: David Paul Morris/Bloomberg
David Paul Morris/Bloomberg

Say it in French

Chatbots are a global phenomenon. Before PayPal came to Slack, its French rival, Lydia, was already there. Users validate payments through a separate Lydia app or, if they don't have the app, can open up a web page to do the same. Lydia launched its Slack bot in April of 2016, and boasts that it is the first to have a payment bot on the chat platform.
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Savvier Spending

Account alerts are nothing new, but using chatbot technology can provide a more useful level of detail. Zor Gorelov, CEO and co-founder of chat tech developer Kasisto, says the company is piloting such a system with RBC and is used by digibank, a mobile-only bank launched in India by DBS Bank in Singapore. “If you send me a notification that says my balance is low, that does not drive engagement,” Gorelov said. “But if you send me a notification that says, ‘You spent $200 in taxis this month, would you like to see your transactions?’ that brings people back and engages them and gives them a better understanding of their money.”
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Cropped shot of a woman handing over her credit card to a salesperson
PeopleImages/Getty Images

Easing into the payment

Chatbots can be used to help transition customers from free trials to paid services. Personetics has built a library of customer insights for its chatbots with this in mind. For instance, one might automatically inform a customer when a 30-day free subscription offer turns into a paid subscription.

The chatbot technology has been fed financial services information for five years, according to Eran Livneh, vice president of Personetics. In other words, the chatbot is akin to an employee who understands banking and serving customers really well, he said. “If this month you spent more on dining out than you usually do, we may point it out,” Livneh said. “That creates trust and engagement."
Gamepad for video games
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Gamified

North Side, a software company based in Montreal, specializes in giving its chatbot, VerbalAccess, a precise understanding of language, whether spoken or typed, through natural language processing technology. Originally it created a video game that lets players communicate with characters to command them to do things and to master the game.

“That’s how we made our natural language understanding pipeline robust,” said Eugene Joseph, North Side's CEO. North Side doesn’t try to glean insights from analyzing customer behavior. Instead, it takes commands and acts on them, such making a payment or displaying a transaction.

If a user asks, “What have I spent on coffee in the last month?” North Side’s chatbot will understand the question and translate it to an API call that will extract the answer automatically. “We’ve invested $20 million in being able to do things like that,” Joseph said.
facebook mobile app user
A man stands and checks his Apple Inc. iPhone 6s whilst framed against an illuminated wall bearing Facebook Inc.s 'Thumbs Up' symbol in this arranged photograph in London, U.K., on Wednesday, Dec. 23, 2015. Facebook Inc.s WhatsApp messaging service, with more than 100 million local users, is the most-used app in Brazil, according to an Ibope poll published on Dec. 15. Photographer: Chris Ratcliffe/Bloomberg
Chris Ratcliffe/Bloomberg

Facebook meets finance

Facebook, which hired former PayPal President David Marcus in 2014 to run Messenger, has been gradually increasing Messenger’s payment capabilities. That includes a person to person feature and transaction collaboration with Uber. Other companies, such as PayPal’s Venmo and Snap Inc.'s Snapchat are also pairing social networking and payments.

Penny Crosman Cropped
Penny Crosman
Executive Editor, Technology at Arizent
Penny Crosman is Executive Editor, Technology at American Banker. She is based in New York. She guides technology coverage at American Banker and... Read full bio
Daniel Wolfe 2024
Daniel Wolfe
Editor-in-chief, Digital Insurance
Daniel Wolfe is editor-in-chief of Digital Insurance. Most recently, he was director of data services at Arizent, which publishes DI and American... Read full bio
John Adams
Executive Editor, Payments
John Adams is executive editor of payments for American Banker. John interviews top executives in the payments, cryptocurrency and fintech... Read full bio
Kate Fitzgerald
Senior Editor, Payments
Kate Fitzgerald is an Arizona-based senior editor for American Banker and longtime payments reporter. Fitzgerald began her journalism career at the... Read full bio
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