When financial inclusion still stares at us like a bobbing watchword, then the times call for revolutionary and more advanced measures. Agreed, a lot has been done, right from integrating external platforms with financial services and banks to mobile wallets, online payment solutions, and even contactless payment services. Yet, a lot more has to be done as will be agreed upon the world over. There is another looming watchword that is fraud or cyber risks that threaten payment ecosystems globally too. In this context, another innovation that promises to transform the future of payments in terms of security and convenience can be biometrics. Picture biometric in-store payments and checkouts across the entire financial services spectrum. Sounds fascinating doesn’t it? Well, it could be closer to reality than you think. How Biometrics are Gaining Momentum Worldwide Multiple aspects are driving the potential adoption of biometrics for payment systems across the globe. These include soaring figures in terms of mobile usage, 5G and other technological advancements (equates to higher bandwidth for businesses and customers alike), and refined artificial intelligence (AI) frameworks. In fact, the good part is that biometrics are not expected to bring about a paradigm shift in terms of hardware and equipment. Rather, it will be driven more by the incremental evolution principle, starting from continual tech improvements to higher usage. Changes are afoot throughout the financial services ecosystem, right from face IDs and facial recognition to voice recognition, and even fingerprints. Yet, with consumers inputting a higher quantum of data into their devices, which includes social, lifestyle, and health data, MFA (multi-factor authentication) patterns will keep improving, thereby bringing about higher personalization. Those looking at leveraging these developments have to naturally counter security threats and rising risks. As a result, varying biometric patterns have to be combined uniquely to keep fraud at bay, while enabling secure and reliable payment and transaction systems for customers. Considering how banks and financial services, not to mention consumers, keep losing billions in fraud each year, it is imperative that a biometric-driven solution is found for fostering trust throughout the ecosystem while enabling businesses to enhance their profitability simultaneously. What’s Happening in the Space? From biometric in-store payments to other groundbreaking experiments, there is plenty happening in this space as we speak. Amazon Web Services (AWS) is already off the block with its Amazon One Enterprise. This uses palm-based identification for combating security issues while aiming at transforming access to various institutions, airports, offices, hotels, and more. This could well put passwords and ubiquitous badges into the past, especially if it gets integrated into something as essential as payments. MasterCard and NEC Corporation are also looking at biometric in-store payments. NEC is offering its liveness verification and face recognition tech with payments enabled by MasterCard as a part of this important collaboration. This takes care of the overwhelming consumer need for quicker checkouts at stores. The Biometric Checkout Program, as it is called, is aimed at enabling PIN-free and faster transactions. Conventional authentication methods are not fool-proof and that is where the gap lies for palm or face-based authentication to become change agents. It will bring about the next big change in validation of transactions by consumers and financial entities alike. Close to 60% of online purchasers are already adopting biometric-based authentication in the United States and the number promises to swell even more in the coming years. Some Other Vital Sides to the Coin The MasterCard-NEC collaboration has already spread to the Asia-Pacific and is looking at leveraging the fast-growing digital ecosystems in the region. It is also significant, considering how 82% of Asia-Pacific consumers are already making use of biometrics in some form. However, there are hurdles that are increasingly eating into the equation, such as privacy issues, data protection, and evolving regulatory changes. An easier integration of facial recognition and palm-based identity solutions for daily transactions and payments will ultimately build a world where passwords and physical identification will no longer be required. With more consumers and businesses eager to adopt this revolutionary system of payments, there is a strong need to find the right balance between ensuring higher security and driving innovation. Facial Recognition Adoption Increases Worldwide Owing to concerns regarding security, accuracy, and other privacy-related worries, the advent of facial recognition technology in the payments space was perceived skeptically at an initial stage. However, these look to be ironed out as more companies make inroads into the space. Ant Banking, the banking entity of Alibaba, was one of the very first organizations to make use of facial recognition for making payments. In fact, customers at Chinese KFC restaurants could make payments as early as 2015 through smiling at cameras. This was enabled under the Smile to Pay facial recognition system of the company. Tencent, another digital entity from China, also integrated facial recognition tech into its WeChat Pay payments system. This enabled all users to seamlessly authorize transactions with their faces alone. MasterCard also came up with the MasterCard Identity/Check feature, which enabled users to make use of face recognition/fingerprint technology for online purchase verification purposes. Apple also came up with its Face ID technology in 2017, which enabled iPhone X owners and other models to take care of payment authentication with face-based biometrics. Facial recognition has been integrated as an authentication system in several mobile payment apps. Transactions can be readily authorized through looking into the camera of the device. POS (point-of-sale) systems are also functioning through consumer payments being done for goods and services by showing their faces to cameras with facial recognition tech which may be added to traditional POS systems. Retailers and service providers may also adopt self-service kiosks with this technology where customers can get access to financial services and payments solutions by going through facial verification at these outlets. Facial recognition is also being used by e-commerce or online merchants for enhancing security at the time of transactions. PIN-based ATM and online banking identification is also being swapped by facial recognition these days across the world. Advantages
