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ToneTag, backed by both Amazon and Mukesh Ambani, is ready to go beyond payments using sound waves, not internet and smartphones


  • ToneTag is using sound waves to power contactless payments and commerce targeting people who have feature phones and those with poor or no internet connectivity.
  • It counts global e-commerce giant Amazon and Reliance Ventures, owned by India’s richest man Mukesh Ambani, as investors.
  • In its second phase, the company plans to use voice for powering discovery, selection and payments at a store, while businesses will be able to use its technology to manage orders and inventory.

Bengaluru-based ToneTag is using sound waves to power contactless payments and commerce targeting people who have feature phones and those with poor or no internet connectivity.

It counts global e-commerce giant Amazon and Reliance Ventures, owned by India’s richest man Mukesh Ambani, as investors. The startup is valued at $38.7 million as of April, 2018, according to the latest data available on
Tracxn. ToneTag has, so far, raised $13.5 million in external funding.

The company also works in partnership with Yes Bank, Bank of Baroda, Amazon, Mastercard, Shoppers Stop, Airtel, Amul and National Payments Corporation of India (NPCI) , among others. The company claims it has scaled its product to 1.5 million merchants and enabled 4,500 smart stores. Besides, it plans to tap over a million merchants across the country via Amazon Pay.


ToneTag, backed by both Amazon and Mukesh Ambani, is ready to go beyond payments using sound waves, not internet and smartphones

In its first phase, the startup used sound waves for powering digital payments that could work without internet connectivity or a smartphone. The average checkout time with their technology was 22 seconds less. Last week, it successfully completed testing its product in rural and urban areas in Karnataka and Bihar, as part of the first cohort under the Reserve Bank of India (RBI) sandbox for retail payments.

Among its peers in India, Ubona Technologies’ product BHIM Voice that was also selected as part of the RBI’s first cohort also uses voice-recognition for facilitating digital payments.

“Before digital payments, transactions and commerce would happen via voice communication. We brought those two worlds together in a way that sound waves in the human voice can be used for inter-device communication. This could propel adoption of digital payments and commerce like never before,” Kumar Abhishek, founder and chief executive at ToneTag, told Business Insider.

Into the future

In its second phase, he said, the company plans to use human voice for powering discovery, selection and payments at a store, while businesses will be able to use its technology to manage orders and inventory. Having launched voice-based payments under the first-phase, it now plans to launch voice-based commerce by December this year.

“As a result of the success of the cohort, ToneTag plans to work with banks and regulated entities to extend peer-to-peer and peer-to-merchant payments and fund transfer services on feature phones via voice for rural customers,” said Abhishek.

Besides India, the proximity communication company has presence across the Middle East, South-East Asia, and some parts of Africa. “We are well-capitalised to scale this to 100,000 daily active users over the next few quarters for just voice-based payment products,” said Abhishek.

How it works

“The way it works is that the moment you come close to a shelf, a sensor would communicate with your mobile device, prompting you to open it for browsing products, checking offers, and making payments without using the internet or even an app,” he said.

Payments can also be made using digital voice-assistants such as Google Assistant, Amazon’s Alexa, and Apple’s Siri.

Once a customer, say, selects a cup of coffee by speaking to a voice-assistant on her phone, it would authenticate the sound waves in her voice for establishing a secure connection between her phone and the merchant’s point of sale device.

“Our audio sensors and proprietary software allow transfer of data via sound in a secure and contactless manner, allowing the customer to select, order and purchase an item in a completely contactless manner,’ he said. Further, all transactions are stored and updated on a blockchain for real-time fraud detection.

ToneTag, backed by both Amazon and Mukesh Ambani, is ready to go beyond payments using sound waves, not internet and smartphones

The solution, said Shree Parthasarathy, national managing partner at Grant Thornton Bharat, empowers consumers across segments to enjoy tap and go experience at the merchant location.
At the time of payment, the sound-based technology, he said, allows exchange of essential information for payment processing such as merchant ID, device ID, transaction reference number and amount, between the POS machines and consumers’ phones. “Based on this information, consumers can approve the transaction on their phone, without sharing the card or account information with the merchant.”

Safer than NFC-device led contactless payments?

Payments made over sound, said Parthasarathy, are safer than traditional near-field communication (NFC) device-led payments, as the sound-based solution offers advanced security through three layers of encryption. Smartphones and card readers are examples of NFC-led devices.

“Possibility of frauds in case of sound-based contactless payment is lesser than traditional NFC-led device payments, as there are special mechanisms to handle relay- and middleman-related attacks. Sound waves are encrypted from end to end to enhance security,” he said.

Besides, the technology is cost-effective for both customers and merchants, said Abhishek. “In India, 600 million users have feature phones, while smartphones with in-built NFC chips are expensive. Voice technology is hardware independent and utilises existing speaker and microphone which is an in-built feature of all the phones to enable digital transactions,” he said.



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