Thursday, May 19, 2022
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How Biometric Secure Digital Payments?

Security is the foremost factor for any business when it comes to financial services and transactions. A business uses different security measures and technology to make sure that no fraudulent activity takes place.

Technology is revolutionizing the banking and commerce sector. They are making financial services faster and easier than before. However, with technology the risk of fraud increases. This makes some people question the legitimacy of its security aspect. So to counter this issue, biometric authentication technology has come up as a potential solution.

Biometric authentication is a technology that uses the biometric features of a user to confirm the identity of a person trying to access a device or service. Every person has unique physical and biological features. These cannot be compared against anyone else. So, this technology uses the biometrics of a person to compare it with the authorised sample stored in the database. If the biometric features of the individual match with that of an approved user stored in the database, then the individual will be granted access to the device. If it does not match, then the access will be denied.

Biometric authentication is usually set up in the physical environment, for example, while accessing gates and doors. The use of biometric authentication has increased very fastly over the years. Because of its fraud prevention nature, it has made its way today devices such as smartphones, consumer devices, and computers. Governments and private organisations are using biometric authentication alike. It is used by them in important areas such as airports, military bases, and at entry ports of national borders.

Types of biometric authentication

1. Fingerprint Scanners

The fingerprint is one of the most common types of biometric authentication. It is used in smartphones and many other devices. These scanners store the swirls and ridges of an individual’s fingerprints. It is then matched with the one trying to access the device. This is widely used as a fingerprint is an individual’s most unique form of identity. Even twin siblings do not have fingerprints on their hands. This makes fingerprinting highly secure.

The latest versions of fingerprint scanners are now able to assess the vascular patterns of an individual’s fingers. Fingerprinting is not the most secure technology. It has its own shortcomings. Despite that, it is the most popular technology and is being used by several enterprises and customers.

2. Facial recognition

Just like fingerprint scanners, facial recognition technology depends on emulating different measurements of a previously authorized face to the face of the individual trying to gain access. These measurements are called faceprints. If an adequate number of faceprints is matched then the user will be getting access.

Even facial recognition technology is famously operational in many smartphones like fingerprint scanners. However, it has one shortcoming. While comparing faces, it views them from different angles and even differentiates between people with similar looks.

3. Voice identification

Voice identification technologies, as the name suggests, records the vocal characteristics under consideration for differentiating among various individuals.

It makes a voice profile of a person by combining a number of data points. Then it compares it with the data present in its database. The voice identification technology aims at the speaker’s throat and mouth for the formation of particular sound quality and shape.

This technology removes the security threats created by voice imitation or with common conditions of cough and cold that might lead to the change of voice quality of the user.

4. Eye scanners

There are mainly two types of eye scanners used. One is retina scanners and the other is iris recognition scanners.

In retina scanners, a bright light is shed towards the eye which forms visible blood vessels patterns. These patterns are then recorded by the scanner and then weighed up against the pattern recorded and saved in the database.

The process used in iris scanners is also very similar. The iris scanner looks for unique patterns in the coloured ring that is present around the pupil of the eye.

It has its limits too. Both the eye scanning techniques might prove inaccurate if the person is wearing eyeglasses or contact lenses. Also, a photograph can also trick these techniques

Use of Biometric in mobile payments

With the increased use of smartphones for the purpose of shopping and accessing banking services post Covid-19, businesses have now started to use biometric technology for safe and secure payments and money transfers.

According to a study by Juniper, mobile biometrics will authenticate in-store and remote payments worth $2 trillion by the year 2023. The study also said that biometrically verified e-commerce transactions will account for around 57% of total biometric transactions in 2023. Their contribution in 2018 was only 28%.

Moreover, the study also mentions that around 90 per cent of current smartphones can support facial recognition. Whereas, 80 per cent of smartphones can support voice authenticated payments. The study estimated that more than 1.5 billion smartphones will use software-based biometrics technology by the year 2023.

So, how did its role in mobile payments increase dominantly?

The foremost role was played by the Covid-19 pandemic. With everything going digital and contactless, the need for making payments more secure was also felt. So, biometric emerged as a feasible option.

Digital banking was dominant even before the pandemic. However, digital shopping was next. Apple Pay was launched in 2014. With this, Apple had set its foot in the payment industry.

This app made payments easier. So, if people were getting comfortable accessing banking services from their phone, then they would use it to make purchases as well.

Big players are providing mobile banking facilities as it is secure and convenient. Also, the same can be turned into a seamless mobile shopping experience. Therefore, players like Samsung and Google came up with Samsung Pay and Android Pay respectively.

Samsung incorporated and established iris scanning as the main component of its mobile payment platform. It offered quality convenience as a user can authorize payments by simply looking at their phone. On the other hand, Android Pay had no biometric authentication. However, many Android smartphones already support this feature.

With an increase in cases of fraudulent activities, no customer is satisfied with only just PINs and passwords. This is the reason why big names like Intel and Microsoft are also utilising and integrating biometric authentication systems with their own products.

Another technology that was introduced by Apple is face ID. It is an infrared facial recognition system designed to protect against spoofing by masks or other techniques. It has been adopted by banks like Singapore’s OCBC and HSBC as well.

Also Read: The rise of Buy Now, Pay Later

Biometric technology & Card Payments

Biometric technology can be integrated with card payments as well. Currently, the card payment method involves swiping a card at any terminal. This method is slowly becoming obsolete in many parts of the world.

These days chip-enabled cards are widely used in Canada and Europe. However, they consume a lot of time as the user needs to enter the PIN in many purchases.

There’s also chip cards that support NFC transactions. Here the customers have to tap their card on the terminal. This method is quite convenient and fast as compared to the other card payments methods that involve swiping. However, it might not be secured as there is no need for a PIN or signature.

This is where the biometric payment cards come into the picture. These cards are infused with biometric security and support tap-and-go payments. All a cardholder needs to do is register their finger on the card’s sensor while making the purchase. Big players like Mastercard and Visa are already in the process of rolling out this technology with their financial service partners.

One more way this technology can be used in card payment is biometric single sign-on. Biometric single sign-on (SSO) is an advanced password management technology. This technology protects data from any unauthorized user. Therefore, companies like Microsoft and Intel are also advising and facilitating banks to enter the biometric space for all the mobile banking services.

Suggested: How do tokenization and encryption secure digital payment?

Should you learn this technology?

Biometrics in digital payments makes sure that users are authenticated and no fraudulent activity takes place. Therefore, in securing the future of payments it is needed. So, the answer is yes.

Why should you enroll in this GFA Course?

Global FinTech Academy aims to make the knowledge behind Financial Technology available to all. We offer a range of courses that make the understanding of Technology easier for you. You can use this to strengthen your career, knowledge, disrupt the FinTech market with new and innovative product/s that are full of potential, or for literally anything. The good news is you get to learn all this in an easy language and from ground zero. Our aim is to deliver the best knowledge to you in the easiest way possible.

In this Business-Oriented course, we will understand;

  • Definition and types of biometric
  • behavioural and physical biometrics
  • how to choose the best biometric system for deployment
  • factors, technology behind biometric capture
  • registration and verification,
  • 1:1 and 1:n matching,
  • biometric system performance management terms and ratios,
  • impact of biometric failure,
  • biometric based digital payments,
  • Face, Iris and fingerprint based payment,
  • NatWest and Royal Bank of Scotland’s biometric card video,
  • CVM, ODCVM, Digital payments,
  • payments processing,
  •  fintech, digital finance,
  • risk in a biometric system.

To get this course for USD10 only, apply code GFA10 at the checkout page.

Get it HERE

See you on the other side of the course.

You can access this course on Udemy as well- Click here

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