Artificial Intelligence has touched a plethora of industries, and digital payments aren’t far behind. We have already seen the magic of AI in chatbots. Let’s say you are looking for Spectrum internet, and you land on the provider’s site to contact their support team. Their online chat support is most likely to be powered by AI.
In the digital transaction industry, AI is streamlining payments and making them more secure. AI is also bringing automation and enabling users to monitor online payment systems. The following are some core ways Artificial Intelligence is impacting digital payments and making them secure:
1: Fraud Detection
The role of AI in fraud detection can change the entire game. Almost every basic necessity today is one click away. The abundant freedom of making online purchases has increased fraudulent activities. Although fraud detection systems existed in the past, the old practices fail to keep up with the progress in online marketing.
AI-based systems are mandatory for smooth workflow while keeping fraud at bay. More and more financial companies are getting inclined towards development systems equipped with AI, to catch fraud, illegal activities, and suspicious transactions.
2: AI-Enabled Facial Recognition
The COVID-19 pandemic gave precedence to AI-driven facial recognition solutions. To contain the spread of the virus and handle payments securely at the same time, many retailers and restaurants have started using face powered payment system, also known as, PopID. This pay via face idea has great potential. It requires less engagement from the customer’s side which is another reason why it’s appealing.
With such AI-powered payment systems, the customer won’t have to take out his card or enter the PIN to complete the payment. They would just have to grab the items and go. This would save so much time and would lead to an increased shopping cart value.
3: Interruption-Free Transactions
After security, another thing that users direly want from digital transactions is a glitch-free experience. The modern customer is not a big fan of unexpected lags.
VISA has introduced Smarter STIP (Stand-In Processing) to leverage deep learning and analyze the past transactions of the user before approving or declining a transaction on behalf of issuers. The prototype of this system was expected to be released in October. This would encourage other players in the industry to look for additional measures to reduce declined transactions.
Soon smooth payment processing would become a significant aspect in terms of retaining customers. This could be done by bypassing system glitches and avoiding costly failures. When such solutions are combined with AI for adopting a more dynamic approach, retaining customers would be easier than ever.
4: Debit Cards Featuring AI
A debit card looks similar to a credit card except that it’s an immediate method of transferring money or making purchases. Artificial Intelligence is now taking over the debit card market as well. When a debit card is linked with AI, it can make our life easier than ever.
Imagine a debit card featuring a built-in AI System containing more features than we could ever imagine. It can track all your due payments, manage and secure your savings, and so much more. In the future, you can expect a lot more from a basic debit card. AI might even change the definition of a debit card as we know it.
5: AI Bots on Facebook Messenger
Financial institutes as well as banks have started using AI chatbots on Facebook Messenger as well for handling payments and offering personalized customer services at the same time. A great example is set by American Express (AmEx). This company is a dedicated chatbot on messenger that sends transaction notifications and other useful reminders to users.
AmEX chatbot can also enable a user to add a card while linking their account to the user account on Facebook. The credentials of the card are stored with the Facebook account of the user in order to facilitate the transaction on the social network. In the future, we will have powerful as well as intelligent AI chatbots for performing tasks on Facebook Messenger.
6: Voice-Activated Payments
Facial recognition is not the only way to make payments. Brands are planning to fully integrate AI-powered smart assistants with voice recognition tech. using voice-activated payments, the smart assistant accesses your accounts to complete the transactions.
Voice-activated payment won’t be hinged on assistants or biometric securities to complete the verification process. This would make payment frictionless. Soon, the traditional payment methods will be replaced by this one.
As AI and machine learning are actively applied to payments, this would remove inefficiencies within the system that are holding merchants back from delivering quality solutions. Not only merchants will drive incremental revenue but will also make the lives of customers easier by delivering frictionless payment solutions.