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PSD2 to drive biometric adoption for online payment authentication: Mastercard


With the number of online transactions requiring cardholder authentication to increase from roughly one or two percent today to as many as 25 percent next autumn, PSD2 will drive a rapid increase in consumer biometrics use, according to research by Mastercard.

PSD2 came into effect on January 13, 2018, and its Strong Customer Authentication (SCA) standards requiring two-factor authentication for online payments across Europe take effect in September, as part of the EU’s plan for a digital single market.

“The use of passwords to authenticate someone is woefully outdated, with consumers forgetting them and retailers facing abandoned shopping baskets,” says Mastercard President of Global Enterprise Risk and Security Ajay Bhalla. “In payments technology this is something we’re closing in on as we move from cash to card, password to thumbprint, and beyond to innovative technologies such as artificial intelligence. It’s far easier to authenticate with a thumbprint or a selfie, and it’s safer too.”

Bhalla suggests that changing consumer attitudes and Mastercard’s implementation of selfie payments and fingerprint cards are setting the stage for greater adoption of biometrics.

On the heels of PSD2 coming into effect, Mastercard announced it will provide biometric authentication for European online shoppers starting in April 2019 to satisfy the regulation’s SCA requirements. Mastercard has been conducting several trials of biometric payment cards, and expanding the coverage of its Identity Check app to new markets to enable biometric authentication in person and online.

BioCatch recently pitched behavioral biometrics as the best way to meet the strong authentication requirements of PSD2 while protecting against the potential vulnerability of connections between third-party payment providers and financial institutions.

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