By Stan Swearingen, CEO of IDEX Biometrics
“Biometrics” has been the buzzword on everyone’s lips within the payments industry this year, and an influx of pilot schemes has confirmed that the biometric revolution is no longer a distant fantasy, but rather a pressing reality.
Following a number of successful trials using fingerprint sensor technology within smart cards across multiple markets, (including Bulgaria, the US, Mexico, Cyprus, Japan, the Middle East and South Africa) the biometric smart card is reaching its inflection point. Key players within the banking industry, including Visa and Mastercard, are already heavily invested in this new payment technology and anticipate that biometrics will play a key role in the revolution of the payments industry.
With mass market rollout on the horizon, here are five key predictions for the biometric payment industry in 2019.
2019: The year of dual interface
The first half of 2017 reported 937,518 cases of financial fraud, resulting in losses of an astonishing £366.4 million, a clear demonstration that the PIN is no longer fit for purpose. Recent research from IDEX Biometrics supports this claim and found that 29% of consumers surveyed felt concerned about the use of PINs to keep their money secure, and as many as 70% believed that contactless payment cards left them exposed to theft and fraud. As consumer concerns continue to grow around the security of payments, so too does the need for a personalised, secure and convenient payment solution.
Enter the biometric dual interface payment card. 2019 will see biometric fingerprint sensors integrated into cards with both a micro-processor and contactless interface, removing the need for PINs. This will provide consumers with the reassurance that their money is safe as any transactions will require their finger print to authenticate it. 2019 will be the year of the dual interface where biometric authentication will be available for both contact and contactless payments!
These advances in technology and those within the payments market have meant that the concept of biometric authenticated payments is no longer a novelty. In fact, according to forecasts by Goode Intelligence, nearly 579 million biometric payment cards will be used globally by 2023. The integration of the biometric sensors in the payment card will be one of the next-generation transformative innovations to breathe new life into the payment industry next year and assist in the fight against payment fraud.
Remote enrolment will be the key to mass market adoption
For mass market deployment of biometric smart payment cards to be possible in 2019, banking infrastructures must look at the implementation of biometric technology and ensure that this method of enrolment is accessible and convenient to all. The elderly or those with physical health limitations may struggle leaving the house to enrol within bank branches and even those who work a 9-5 day can often find making it to the bank within opening hours a challenge.
The latest advancements in remote enrolment of biometric payment cards will mean that enrolment for biometric payment cards can take place in the comfort of your own home. Card users will be able to enrol straight onto the card by simply placing their finger on the sensor (with the aid of a small device that comes with the card) to upload their print to the card’s highly secure EMV chip. There is no need for an external computer, smartphone or internet connection. Once loaded, the fingerprint never leaves the card, thus eliminating multiple attack points.
Biometric payments will bridge the gap to financial inclusion
In 2019 advances in biometric fingerprint authentication will be a vital ingredient when bridging the gap to financial inclusion. Currently, 1.7 billion adults remain unbanked across the globe today. This is for many reasons, from immigration issues, to illiteracy as well as mental health. Those living with dementia are also at risk of losing their financial independence as their short-term memories decline. A fingerprint sensor on the card can take the place of a PIN or even signature, meaning sufferers are able to stay financially independent for longer.
Currently those who lack access to financial services are missing out on the many benefits financial inclusion has to offer. Fingerprint authentication will remove the barriers that face those with literacy challenges, or face difficulty with memory, as card payments will no longer be about what you know, or what you can remember, but who you are.
Biometric authentication will be a simple, secure and convenient solution eradicating the need for passwords and PINs as a form of authentication. For this to work as a solution to financial inclusion, banking infrastructures and card manufacturers must work together to reach a price point that enables this technology to be available to all.
The possibilities for biometrics are endless…
While biometric authentication technology is already being used with smartphones and passport identification in the UK, 2019 and beyond will see endless possibilities for the use of biometric smart cards into payments and beyond. We can even expect to see biometrics branch into the Government issued identification and IoT enabled devices arenas.
In fact, a whole host of public services is set to benefit from this secure means of authentication. The use of biometric smart cards within the NHS, for example, could see access to sensitive patient records limited only to the patient themselves. Biometric social benefits cards could control how the money is spent and that it is spent by the right person. According to IDEX research, 38% of consumers surveyed would like to see biometric methods of authentication introduced to wider government identification including driving licenses, National Insurance numbers and even passports.
The future of the biometrics – 2019 and beyond!
In 2019, authentication will get even smarter, and further technological advances such as multi-modal or multi-factor authentication will further enhance security within the payments landscape. This refers to technology that combines a variety of different types of biometrics in order to add an additional layer of security, including persistent authentication. For example, instead of having one single authentication, smartphones could continuously scan features to ensure the correct person is using the device.
Whilst the biometric dual interface smart payment card is set to hit the mass market next year – this is just the beginning. The payment card of tomorrow will go beyond just transactions. Biometric smart cards will serve multiple purposes – a payment card, a form of ID for restricted goods and even a loyalty card!
The early days of biometrics where it was felt to be invasive and a privacy concern are long gone. In fact, according to recent research from IDEX, 56% of consumers surveyed state they would trust the use of their fingerprint to authenticate payments more than the traditional PIN. Further to this, 52% would feel more confident if their fingerprint biometric data was stored on their payment card, rather than a bank’s central database.
Consumers are ready for the use of biometric fingerprint methods of authentication for card payments and 66% expect their roll out to authenticate in-store transactions in 2019. We predict that by 2019 biometric smart payment card adoption will go into many millions!