Consumer anticipation of biometric payments surges as contactless takes over from cash
Cash is disappearing and payment cards are being used more, shifting consumer attitudes about biometrics for payments and presenting a major opportunity for fingerprint cards, a new survey report and a pair of company posts suggest.
More than half of Canadians expect that biometrics will be part of the way they purchase things within the next decade, according to a new survey.
As a Research Co. report shows, credit card purchases doubled during COVID-19 lockdowns to 50 percent of all transactions, up from 24 percent in February 2019. Another 31 percent of payments were processed with debit cards, and 4 percent through e-transfers or with a smartphone, compared to only 3 percent with cash.
“These numbers outline a drastic transformation from 2019, and show that the COVID-19 lockdown has decidedly altered the way Canadians are buying things,” says Mario Canseco, President of Research Co. “This change in behaviour is also leading many Canadians to believe that biometrics will be required to complete purchases in the near future.”
In the previous survey, just over a year ago, a mere 8 percent of Canadians said they expected to use biometrics for purchases in the next ten year. That number has risen to 58 percent, with 50 percent also saying they would like biometrics to be used in their lifetimes.
The number of people wanting biometrics to be used for purchases varies by up to 13 percent between different Canadian provinces.
Contactless payments are up, and withdrawals of cash from ATMs are down, according to an article on Thales’ website.
Research from The Futurist Group shows that 38 percent of consumers considering credit card offers see contactless operation as a Table Stake need, up 26.6 percent from a pre-COVID-19 survey. With bodies such as the World Economic Forum pushing for passwordless transactions, and the Financial Action Task Force encouraging digital onboarding, that makes biometric payment cards a safe trend, according to Thales.
Digitized cards in mobile wallets can likewise provide biometric protection, usually through the user’s mobile phone, and Thales notes wearables can as well. While this method has previously been associated with specific consumer populations or events, the direct accessibility of wearables could provide a major advantage in the new normal, which often includes wearing gloves in retail settings.
Thales also points out that the European Banking Authority is encouraging contactless and remote payments adoption, and that Juniper Research forecasts contactless transactions around the world will grow from roughly $2 trillion in 2020 to nearly $6 trillion in 2024.
A report from Research Nester published as global lockdowns began in February forecasts that the worldwide market for biometric payments will grow by 36 times from 2018 to 2027, surpassing $15.5 trillion. Growing fraud concerns and the need to secure online payment systems were identified as the key market drivers, with mobile payments racing ahead at a CAGR of over 52 percent, according to the 146-page “Global Biometric Payments Market Outlook 2027.”
The number of users of contactless payment technology has spiked by 30 percent in the U.S. since March of this year, and 70 percent of those adopting contactless payments say they plan to continue using them, according to research shared by Idemia.
The use of cash in the UK fell by half during March, and the UK and Canada are among more than 40 countries that have increased their contactless payment limits since March of this year.
Idemia touts its membership in the White Label Alliance (WLA) to provide local payment schemes with an open standard for dual interface transactions, and its F.Code fingerprint authentication as the means for addressing this new social context for payments.