E-Pay Leader Expands Consumer Options while Controlling Biller Costs with VoiceXML

Fort Knox National Company (Fort Knox) processes nearly 20 billion dollars in payments annually for more than 700 companies, including some of the top utility, mortgage, insurance, and consumer finance billers in the United Sates.

As a leading provider of single-source electronic payment solutions, Fort Knox has been at the forefront of innovations in the payments industry for nearly 20 years.  Its TruePay™ payment platform is an example of the company putting innovation to work for its customers. 

In recent years, driven by regulatory changes and consumer preference, the popularity of the telephone channel for bill payment has skyrocketed. The downsides of this trend—expanding call center loads and the need to capture each caller's verbal affirmation—increased the costs and complexity of providing e-payment services. Fort Knox responded with characteristic vision and turned a challenge into an opportunity. 

Fort Knox faced challenges in the process as it integrated Web-based TruePay with the telephone channel. By combining VoiceXML-based speech applications with TruePay, Fort Knox has expanded options for its clients and their customers while controlling costs. 

The Growth of Telephone Bill Payment
New rules enacted in 2001 created simpler consumer Automated Clearing House (ACH) authorization via Internet and telephone channels. As a processor of consumer-to-business (C2B) electronic payments, Fort Knox benefited when the National Automated Clearing House Association (NACHA) cut the red tape and eliminated the requirement for consumers to pre-enroll in payment programs. 

Billers could now electronically post telephone-initiated (TEL) ACH debits to consumers' checking or savings accounts based on verbal authorizations to do so.
For consumers, there was new convenience in being able to contact a biller and make a payment at any time. For billers, the new rules enabled them to reap the benefits of electronic funds transfer and automatic posting while eliminating many of the costs of credit and debit card acceptance.

C2B e-payments were already increasing in volume. Due to the expanding use of the Internet, consumers were not only willing but eager to make payments via the Web, and had begun to expect the availability of such services. But despite the steady climb of Web usage, the telephone remained by far the channel of choice for most consumers. 

The Fort Knox Web site provides a dramatic view of this trend. On the home page at www.fortknoxnational.com, a banner proclaims "since you've been here we've processed…" and rapidly rising numbers dynamically update the volume of payments handled by Fort Knox for its customers via the Web and its call center.  The numbers vary by time of day and other parameters, but the volume of calls far exceeds the Web-processed payments.

With the growth of wireless technology, telephones remain one of the most ubiquitous communication devices. With new speech-enabled technology, voice is becoming a new application.  But while consumers enjoyed the inherent simplicity of paying by phone, billers began to experience new problems.

A Costly Dilemma
For the most part, NACHA's development of rules for Internet-initiated payments successfully addressed the need for customer automation via that channel. But for the more prevalent voice channel, automation was in conflict with the goal of electronic payment adoption.

The TEL rules were designed for "agent driven" telephone payments, requiring that consumers verbalize their consent to the terms of their ACH transactions. Call center agents must recognize that consumers have provided "explicit affirmation" of consent. Thus, the growth of TEL ACH translated directly to commensurate growth in agent call center volume and infrastructure.

For billers wishing to replace call center traffic with higher degrees of service automation, the implementation of TEL ACH created a step backward in service efficiency and costs. Billers faced challenges in accommodating TEL ACH volume during peak customer payment periods while ensuring that other customer service functions were provided. Ironically, of course, customer service automation is intended to automate simple transactional processes, like payments, so that agents can focus attention on higher value interactions with customers.

By nature of its design, touchtone Interactive Voice Response (IVR) is not a true voice channel, even if a telephone or wireless device is involved. More importantly, to be NACHA-compliant, each telephone payment requires an explicit, verbal affirmation of the consumer's consent to the terms of the transaction, and keypad response entry does not satisfy this requirement.

As always, consumer preference is pivotal. In a presentation to the Association of Financial Professionals in November 2003, Karen Brewster and James Fugitte reported that despite 24/7 access to IVR's compared to limited call center hours, some larger lenders see nearly 70 percent of callers opting out to agents to make bill payments.

Fort Knox faced serious hurdles in providing voice e-payment in a cost-efficient manner.  However, it was also clear that to serve its billers' needs on an ongoing basis, it needed to provide an effective, cost-efficient telephone bill paying service. It began to study the problem in depth and seek input from industry experts including MCI®.

Build Versus Buy
Fort Knox initially considered putting VoiceXML-based speech recognition technology on some of the servers in its own network, but first performed a thorough build-versus-buy analysis.

Despite the simplicity of the VoiceXML software architecture, building a sophisticated speech application that can accommodate call volumes of larger billers is a complex and costly proposition. 

First and foremost are system design and development considerations, then there are software costs, and finally, there are setup requirements unique to automated speech payment, including voice talent, port allocation and licensing, audio recording and digitization systems, and large-scale network storage devices. Also, because speech technology continues to advance and evolve rapidly, ongoing platform updates and testing could put a drain on IT resources that may be used more productively on other initiatives.

Analyzing all of these issues, Fort Knox came to the conclusion that for them, time to market, initial deployment costs, and ongoing maintenance costs would all be lower with a managed service than an in-house system. 

By outsourcing and taking a network-based approach, Fort Knox could provide its customers with the most advanced speech technologies, a nationwide network of system redundancy, and pricing based on economies of scale that few companies could achieve alone.

The Critical Nature of Usability Testing
Fort Knox worked closely with MCI to develop a VoiceXML interface to TruePay. Initially, the application was tailored to a specific Fort Knox client.  The detailed design included how the call flow would work, the specifics of error handling (for example, if a caller says something unexpected, how many times are they re-prompted and what type of help is given on the re-prompt), and other client-specific elements such as account number structures. 

After internal testing at MCI, the system was provided to Fort Knox for usability testing.  The Fort Knox usability testing involved hundreds of participants calling in to the application.    

It's very important to understand the vital role of testing for a speech application. The goal of usability testing is to see how well the application meets callers' needs and expectations in a live environment.  This stage is actually an essential step in the design process, not simply a final "check and confirm" run-through.

In testing a touchtone system, for example, if a consumer presses a "9," that routing can be validated. However, the nature of a speech application is that there is no single "right" answer.  A verbal affirmative can take the form of a "yes,' "yep," "OK," and so on.  Instead of saying the biller's company name in full, a caller might say "my finance company" or use an acronym. Callers may make unexpected responses that were not considered in the initial design or have regional accents that call for adjustments.

Fort Knox and MCI analyzed the testing feedback and fine-tuned the application accordingly.  The high volume of feedback was extremely valuable to identify and solve problems before the application went into production. For example, several test participants indicated that the system was having trouble recognizing the word "Visa"—and this problem was solved by adjusting grammars and confidence intervals. 

As is common in usability testing, some participants offered words of encouragement: "It met my expectations 100 percent" and "It was perfect."  But others provided a reminder that consumers have preferences, and not even the best speech application will be embraced by everyone:  "I prefer live operators."

The Results: TruePay Today
Since the first implementation in mid-2004, Fort Knox has expanded the speech application to additional clients and is now working with MCI to make automated speech technology a cornerstone of the Fort Knox offering.

Built around network telephony, XML, and Microsoft .NET technology, the propriety design of the TruePay platform now includes a full suite of voice services, including VoiceXML-based MCI® Voice Portal® applications and Enhanced Call Routing® that can be deployed rapidly and customized to meet each biller's unique requirements.

Troy Critchelow, vice president of product management, Fort Knox National Company, said, "Automated Speech Recognition (ASR) technology holds the key to allowing billers to benefit from consumer adoption of electronic payments and payment automation.  Through the use of ASR, telephone payment transactions can now be fully automated.  And given consumers' preferences for voice interfaces, billers can exponentially cut the number of customers who opt-out to costly operators to make telephone payments."

As speech applications become vital for return on investment in electronic bill pay, Fort Knox is ready with a standards-based solution. Released in October 2003 TruePay 5.0 is focused around the application of telephone payments in today's biller service environments—integrating easily and economically within billers' existing customer service, collections, and treasury processes.

Tom Smith is senior product manager of MCI Speech Solutions, a suite of in-network Voice XML-based speech services. He has been with MCI for fourteen years, and has led the Speech product management team since 2001.

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