Press '1' for the success of LloydsTSB IVR system

LloydsTSB is finding that when it comes to banking, customers like talking to robots rather than humans, with the bank today announcing it has handled over 70 million calls with interactive voice response technology (IVR).

With volumes of around 70,000 calls per day, the system - from Nortel Networks - is proving a hit with banking customers. But it's a far cry from the bad old days of 'if you require this service, press one now'. Today's IVR can allow users to speak in sentences, recognising speech to transfer balances, make payments – even authorise overdrafts.

IVR technology is increasingly becoming an everyday part of call centres. It's made its way into around 63 per cent of call centres, according to the Merchants Global Contact Centre Benchmarking Report 2003 – a huge jump from 1999, when just seven per cent had the technology in place.

Part of the appeal for users is convenience – and part is the privacy. Peter Littlewood, senior manager of IVR service development at LloydsTSB told silicon.com that often customers are happier asking an automated voice for an overdraft than a real human being.

"It's good for those customers who are still a little bit worried about talking to their bank manger," he said, adding the bank has in-person support for those who would rather talk to a 'real' call centre agent.

The LloydsTSB/Nortel IVR is designed to take into account a user's familiarity with it, asking different questions depending on how well the customer knows the system – eventually ending up with the customer able to override all the prompts and get the system to complete the transaction they want.

According to Littlewood, the move towards automation is a response towards the sheer speed at which virtual banking took off – "phone banking has grown at such a rate we couldn't build call centres fast enough," he said - as well as a general response to customer demand for quicker and less complex transactions.

There's also the obvious cost benefit, with Dimension Data recently estimating IVR can save a contact centre around 30-40 per cent.

The 11-year-old Nortel/LloydsTSB partnership has no plans to sit back now, seeing a bright future for the technology.

The two companies are currently undertaking trials of using speech as a biometric – verifying a customer's identity by the unique features of their voice. The trials should be completed in two weeks and the bank is firmly convinced that the technology will be rolled out.

And there's still room for development, according to Lloyds TSB and Nortel. "I see a move towards convergence with the web – with speech driving internet banking," Littlewood said. "There may well come a day when you can sit in front of a virtual bank, maybe talking to an avatar of an agent."

Andy Dennahy, Nortel Networks EMEA's director of self-service solutions, agrees. As well as focusing on delivering the technology in new ways over mobile devices, like PDAs, the automated voices themselves will be updated. "We're developing new levels of naturalness in speech," he said.