Learn Swedish: Vi talar svenska hemma. - We speak Swedish at home.

Both mean to speak or talk, but talar sounds a bit more formal, similar to the English word speak. The word pratar is more casual, like talk. When discussing what languages you know, you can use either one, but talar is very common.

Why is svenska written with a lowercase letter here?

In Swedish, the names of languages and nationalities are not capitalized unless they happen to be the first word of a sentence. So it is always svenska, never with a capital S.

Could I use hem instead of hemma in this sentence?

No, because hemma means you are currently located at home. The word hem is a directional word used for motion towards your home, like when you say vi går hem (we are walking home). Since the speaking happens while you are already at the location, you must use the stationary form hemma.