Posted August 13, 2018 by FreedomPay

Can Biometrics Become Mainstream?

A few years ago, making payments with a retinal scan seemed like something out of a sci-fi movie. Today, biometrics is the new buzzword in the security and payments processing industries.  However, getting biometric technology to comply with the realities of payments processing and the strict regulations protecting private data might be a bit more complicated than conventional payment options.

Biometrics uses unique physical characteristics—a fingerprint, the iris of your eye, or your face—to authenticate identity. At a retail level, when that biometric feature is matched to a credit card account, the purchaser is verified, and the purchase is approved.

The science of biometrics interconnects perfectly with the concept of contactless payment, yet there are clear barriers to entry for this new technology. One barrier may be that consumers aren’t eager or willing to have their eyes or fingers scanned and stored for later payment authentication uses. Behind the scenes, such a process would also require a third party to secure the consumer’s biometric data and then encrypt it when a merchant requests it for authentication.  Another barrier is the merchant community who would most likely be required to purchase costly new hardware. Even today there is resistance to EMV, the industry standard since 2015.

Visa is attempting to overcome these barriers with a pilot program for a new hybrid card, where the user’s fingerprint is securely stored in the card. When used, the user places his or her finger on the card’s sensor and the sensor-scanned print is compared to the stored print. A match or non-match is indicated by a green or red light, and the transaction is approved or declined. Best of all for merchants, the card is compatible with existing terminals that accept chip-based or contactless payments.

In general, American consumers seem to be late-adopters when it comes to payment technology. For example, according to PYMTs, Americans’ usage of contactless payment such as the Apple Pay mobile wallet or a tap-and-pay card is low compared to consumers in the UK and Australia.  When used, contactless payment seems to be more popular when paying for low cost items such as coffee or groceries.

There’s no disputing the speed or convenience of contactless payment at the POS. As cell phone users upgrade to newer devices that offer fingerprint versus password-based verification, acceptance of the biometrics concept within the payments universe may increase. In fact, 86 percent of surveyed participants by VISA said they would prefer biometrics to verify their identification versus an easily forgotten password. As with most things on the payment processing side of transactions, guaranteeing security of the data will be key.

As a company, FreedomPay closely follows payment trends and is on the leading edge of secure payment solutions. Driven by innovation, we’re excited to explore the possibilities of new technologies, such as biometric solutions.  If you’re interested in learning more about biometric solution contract our sales team here.