HMRC records over 3 million chatbot exchanges since start of pandemic

Her Majesty’s Revenue & Customs (HMRC) has recorded over 3 million chatbot exchanges since the start of the COVID-19 pandemic, according to the result of a Parliament Street FOI

The Parliament Street think tank has found that the number of interactions with the HMRC chatbot service surged from just under 200,000 in financial year 19/20, to almost 2.5 million in FY 20/21 – a total rise of 1,150 per cent.

While chatbot interaction had cooled slightly in the most recent financial year, this still proved significantly higher than pre-pandemic levels, at 846,937.

Altogether, this represents a total of 3,275,046 separate chatbot interactions since the start of COVID-19.

Increased digital demand and budget

Parliament Street researchers and third party experts concluded that the significant uptick in chatbot interactions was a result of COVID-19 and lockdown, where demand for tax relief services and revenue support surged.

Additionally, the increased demand for digital services was reflected in HMRC’s recent hike in IT budget — over £1bn (£1,074,700,000) was spent on IT in the past 12 months, compared to just over £900 million being its tax budget in FY 20/21.

This represents a total IT budget increase of 54 per cent, from FY 19/20, to the most recent financial year, FY 21/22.

“Over lockdown, chatbots became part of the solution that helped large organisations deal with the onslaught of online requests that were coming in every day to ease the burden on under-resourced teams, and to placate customers with either a simple resolution or to encourage them that the process is underway to deal with their enquiry while they wait for a live customer service agent,” said Suvish Viswanathan, head of marketing at Zoho Europe.

“However, chatbot platforms are still evolving. They can often offer guided conversations and are sometimes unable to understand the purpose of a customer’s complaint or request. Until these kinks are ironed out, it’s essential that businesses looking to provide a positive customer experience do so with a combination of chatbots for basic requests, and have an option to switch to human support at the right time.

“It is also vital for the data gathered to be connected to other systems, such as Customer Service Management tools, to complete a sophisticated and holistic online customer service process. This will play a vital role in ensuring follow-ups can be made methodically and efficiently. It can ensure seamless customer interaction with continued conversations at different parts of their journey with a brand, rather than having to start from scratch each time.

“The right approach to chatbots drives deeper consumer engagement, reduces waiting times and generally improves customer satisfaction.”

Niall Crosby, CEO, CTO and founder of AG Grid, commented: “When used correctly, chatbots can play a vital role in alleviating organisations of thousands of basic customer services requests.

“However, the ‘one-size-fits-all’ policy typically associated with chatbots, where it’s impossible to get a human response to a bespoke issue, can lead to frustration and a poor customer experience.

“In this case, it’s positive to see that HMRC have understood the value of investing in its chatbot programme so that it does not fall into this category. Other organisations which are inundated with customer services requests should follow suit, particularly as the demand for digital and on-demand support continues to rise.”


The ethical implications of chatbots — Hargo Kalra, business intelligence manager at ContactEngine, discusses the ethical matters to consider when it comes to deploying chatbots.

Rebuilding public infrastructure with digital capabilities post-COVID — Ryan Oakes, Accenture Public Service global managing director, and Mark Lyons, managing director for Accenture Public Service in Europe, discuss the need to rebuild public infrastructure with digital capabilities.

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Aaron Hurst

Aaron Hurst is Information Age's senior reporter, providing news and features around the hottest trends across the tech industry.