Friday, August 3, 2018
Biometrically authenticated payments are poised for growth, but consumer concerns about security could thwart this fledgling trend. That's the upshot of a new report from Transaction Network Services. This contrasts with a survey commissioned in 2017 by Visa Inc., which suggested consumers are eager to leave passwords behind for biometric authentication at the POS and for other financial transactions.
Biometric authentication refers to the process of verifying that someone is who he or she claims to be through the use of fingerprint or iris scans, for example. Many consumers already use biometrics to unlock their smartphones and other "smart" devices, like wearables. Juniper Research estimated there were 190 million smart mobile devices (phones and wearables) worldwide in 2016; by 2021 that number is projected to be 600 million.
Payments are seen as a logical application for biometric authentication because of the sensitive nature of transactions and because, unlike passwords, biometrics can't be compromised. The consumer survey Visa commissioned last year found 61 percent of respondents thought biometrics were easier than passwords; 70 percent thought they were faster than passwords. Over 80 percent said they were likely to use fingerprint or facial recognition for banking; half said they would consider leaving banks that did not offer biometric authentication.
An independent report commissioned by TNS and released this week, Vital Insights into Biometric Payments Adoption, meanwhile, revealed that 15 percent of adults have made biometric payments in the past year, including one in four adults between the ages of 18 and 24. However, a staggering 61 percent said they felt providing companies with their fingerprints or iris scans would put their personal identity information at risk.
"The industry needs to take measures to both ensure the security of this sensitive information and to convey to consumers what protections are in place," Mark Collins, managing director of TNS's fintech solutions business in Europe, the Middle East and Asia, said in discussing the survey results.
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