Biometrics and the future of payment transactions
This is a guest post by Lynne Jeffery, Head of Public Safety Solutions at NEC New Zealand.
Biometric technology is fast becoming a part of daily life for many people around the world. Thanks to the integration with mobile devices, many of us are interacting with some form of biometric authentication daily.
According to a 2017 survey by Visa, two thirds (65%) of consumers reported that they are at least familiar with biometrics. With this big uptake in familiarity and use, it’s perhaps no surprise to see a rise in the number of transactions that are now authenticated using biometric technology.
New research from Juniper Research found that mobile biometrics will authenticate $2 trillion worth of in-store and remote mobile payment transactions annually by 2023. This represents a huge jump from the $124 billion expected for 2018 and indicates not only a shift in consumer adoption of biometric authentication, but also rapid advancements in the technology being used to present these opportunities for biometric authenticated payments.
Benefits of biometric authentication for payments
Consumers are starting to see a number of benefits of using biometrics as a form of authentication. The obvious one, which is what the majority of people use on mobile devices, is the elimination of the need to remember a password or PIN to access your device. This, however, also rings true for payment authentication. Being able to authorise your Google Pay or Apple Pay using biometric authentication (fingerprint or facial recognition) means that the payment process is often much quicker when shopping online.
In the Visa survey, consumers also felt that biometric authentication was more secure than a password or PIN. Biometric authentication is unique to the individual. It cannot be easily replicated or stolen and consumers felt it was a unique way of confirming their identity.
Top 5 reasons to authenticate payments using biometrics
Alongside ease and security, there are a number of other benefits of using biometric authentication for payments:
1. Ease of use – don’t need to remember multiple PINs and passwords.
2. Security – a unique and personal way of identifying individuals.
3. Speed – whilst it may be fairly imperceptible, authenticating using a biometric identifier is quicker and easier than entering a pin or password. This benefits both the consumer as well as businesses, with the path to conversion made much more straightforward by the adoption of biometric payment authentication.
4. Pay anywhere – as more and more retail outlets move to a contactless payment model, the uptake of consumers choosing to pay using Apple and Google Pay on their mobile devices, authenticating with biometrics, means that you can pay anywhere, anytime.
5. Future-proofing – early-adopters of biometric authentication for payments feel a lot more comfortable as new forms of biometric authentication are introduced and other authentication methods are slowly retired.
The future of biometric and payment authentication
There is no doubt that biometric authentication for payments is the way the world is heading. Whilst the USA and Europe are often seen as innovators, it’s actually India who lead the way when it comes to biometric adoption for payments. They currently have over 1 billion consumers who have established a digital identity with the government. Fingerprint and iris recognition captures are kept on file along with an image and this is then used for the collection of social welfare payments.
Visa are also rolling out new payment cards through Mountain America Credit Union and Bank of Cyprus which will feature an on-card biometric sensor for contactless payments. The card will test the use of fingerprint recognition as an alternative to PIN or signature to authenticate the cardholder during a transaction. The pilot is part of Visa’s programme to support the growing demand for biometric technology in the payment category under the Visa Ready for Biometrics programme.
A recent blog post by NEC New Zealand analysed the future of facial recognition and what this might look like in 2020. One such area is the use of facial recognition for complete contactless payment. Your credit card details will be associated with your facial recognition profile and payment will be made simply by presenting your face. This is already under development in Taiwan and Japan at 7-Eleven stores who are rolling out staffless stores where customers can do everything from accessing the store to making a payment using their facial recognition profile.
As we head towards 2020, we expect to see an even greater roll out of biometric technology as a way of authenticating payments. Biometric technology is constantly developing and improving, both in terms of accuracy and speed, and this is helping to break down any potential barriers for consumers and instill a sense of security and ease-of-use with this form of payment authentication.
About the author
Lynne Jeffery is the Head of Public Safety Solutions at NEC New Zealand. Lynne has over 20 years’ experience in the global technology sector with a specific expertise in biometrics and cyber security solutions.
DISCLAIMER: BiometricUpdate.com blogs are submitted content. The views expressed in this blog are that of the author, and don’t necessarily reflect the views of BiometricUpdate.com.