Biometrics in payments

Biometrics for security of payments is not completely new, but there is a lot of development to come. Fingerprints are all the rage, from iPhone to Mastercard. Developments from Mastercard in 2017 suggest that usability of biometrics will be a major focus of 2018. Here we look back at the developments of 2017 and to what is to come in the new year.

In April 2017, Mastercard unveiled what they called ‘the next generation biometric card.’ It combines chip and fingerprint technology to verify the cardholder’s identity for in-store purchases. 

Mastercard began their first trial in April in South Africa with Absa Bank. The European trial began in July in Bulgaria with UniCredit Bulbank

Despite this project being months old, it has not yet widely reached consumers. As such, in 2018 we are likely to see more focus on ‘the platforms that will actively bring the technology to consumers,’ Bob Reany, EVP of identity solutions for Mastercard told Bank Innovation. For example, fingerprints are authenticated using existing POS terminals. Biometrics was new and exciting in 2017, but 2018 will see focus on making the technology useable and scalable.

An important consideration for biometrics is data security, and in Europe this means GDPR compliance. Convenience and privacy are always a balancing act.

The European Association of Biometrics (EAB) gave a seminar on Biometrics in Banking and Payments in London in November. In December, EAB held its popular Biometrics in Banking and Payments seminar at the ABN AMRO headquarters in Amsterdam. This event, like Mastercard, focused on the practicalities of implementing biometric security on a wide scale. Both in-branch and mobile implementation of biometrics need to consider customer interaction, operational efficiency, fraud reduction and prevention.

Mobile interoperability is important because “the mobile payment trend will continue to strengthen as we move ever closer to the cardless society,”, says Mark Ranta in his 2018 Payments trends

It’s not the sexiest part of biometrics, but the details of implementation and interoperability will bring the authentication technology to the everyday customer in 2018.

By Grace Appleford, Research Analyst for Holland FinTech.

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