What are Biometric Payments?
What are biometric payments? Biometric payments are a point-of-sale (POS) technology that uses biometric authentication such as fingerprints, facial mapping, or an iris scan to verify a person’s identity.
Have you ever left your house, arrived at a store or restaurant, and then realized you forgot your wallet? Unless your card is set up on your smartphone and the business accepts mobile pay, you’re out of luck.
Businesses have been aiming to solve this challenge by integrating an entirely new payment solution called biometric authentication. With biometric payments, don’t worry if you left your wallet or phone at home… you can make a purchase without any form of physical payment!
Understanding Biometric Payments
Biometric payment solutions allow people to conveniently pay based solely on their unique physical characteristics. Biometric technology uses individual physiology – facial geometry and fingerprints – to verify a person’s identity. By eliminating the need for users to submit their financial information every time, this makes paying fast, simple, and secure.
The top 5 authentication characteristics include: fingerprints, facial mapping, iris scan, palm veins, and voice recognition. Technology will look at any of these five attributes and verify a person’s identity.
Card PINs and numbers can easily get stolen, but your physical characteristics will always be unique to you! To ensure powerful security, biometric payments use encryption and tokenization to protect a user’s identity and account data. There is also a follow-up scan to confirm their identity once again when it comes time to pay.
To make biometric payments as convenient as possible for businesses, they can be integrated into traditional point of sale (POS) devices or normal self-service kiosks.
The Top 5 Biometric Authentication Types:
Fingerprints
This is the most common form of biometric authentication. Fingerprint scanning has become a common way to provide identification, whether it is to unlock smartphones, confirm one’s identity, or authorize payments.
Although this is a simple and secure way to authorize payments, it is not always possible. Fingerprint scanning requires physical contact with the reader, so there may not always be an accurate read, depending on the natural dirt or oils that hands produce. There is also always the possibility of users sustaining hand injuries or other complications, which would affect their ability to use the scanner.
Facial Mapping
Facial mapping performs a scan of someone’s face by using a smart camera. The camera captures an image of the face and compares it to the data on file. Similar to Apple’s Face ID, the camera picks up several details, which allows for a more accurate result.
For example, a scan may measure the distance points on a person’s face, like the spaces between their eyes, nose, or jawline. The camera can also pick up skin details and use this to assist in accuracy.
Although facial recognition is fast and easy, some consumers may not feel comfortable with a company storing their image in a database… with good reason! Companies can claim to encrypt biometric data, but techniques that hack these systems are becoming more and more common.
Iris scans analyze unique characteristics in a person’s eye, specifically the iris. This looks at the colored part of the eye surrounding the pupil and scans the back of the eye. Not only are these scans accurate and dependable, but they are more hygienic than fingerprint scanners since the system scans the eye from a distance. They also completely eliminate the risk of hackers accessing data because the systems automatically encrypt iris scan data.
Although this method may seem like the way to go, it is not always possible. Unfortunately, iris scans can be overly sensitive, and they require specific distance and lighting to work. Images must also be free from obstructions, like contact lenses or eyelashes. If these guidelines are not followed, the system will not be able to verify a person’s identity and no payments can be made.
Palm Veins
Palm vein authentication has become more common. When a customer holds their hand over a reader, the sensor captures an image of the vein patterns in their hand.
This method is convenient and fast, which is why it has been popping up in hundreds of Whole Foods locations. Amazon has introduced a palm recognition device of their own called Amazon One (see below). Many other businesses besides Whole Foods have begun using Amazon One and they will most likely become more common in the near future.
Voice Recognition
This method uses audio to authenticate a user’s identity and compares the customer’s voice to a prerecorded sample. By analyzing unique speech patterns and voice characteristics, this method can certify a match instantly. Although this method is cost effective, almost all the systems require a quiet environment for accuracy, which would be difficult for most businesses.
So... What Now?
Although biometric authentication has been in the hands of consumers for almost a decade now, using biometric payments is still relatively new in most markets… but growing rapidly. Once used primarily by law enforcement and security agencies, biometrics has now become more mainstream. According to Goode Intelligence, global biometric payments are expected to reach $5.8 trillion and have more than 3 billion users by 2026.
Biometric Authentication Advantages
There are many benefits to accepting biometric payments, both for merchants and consumers. By storing payment data locally, biometric payments are more secure than traditional payments. To remain competitive and meet the needs of consumers, businesses must be ready for payment changes in the near future.
In a time where convenience is king, it doesn’t get much more convenient than this. The process is fast, seamless, reduces checkout times, and improves the overall user experience. As people become more familiar with biometric payments, its usage will increase. Consumer attitudes are a function of familiarity.
There are also no extra hardware upgrades or processing fees. Since biometric payments are cardless, there is no need for merchants to purchase additional hardware. And because contactless payments don’t add on extra hidden fees or charges, no need to worry about paying anything additional!
Biometric Authentication Disadvantages
While there are great benefits to biometric payments, there can also be some drawbacks.
One concern people may have is whether or not biometric authentication is dangerous. Although it may seem surprising to some, these technologies pose no harm! There is nothing injurious, radioactive, or carcinogenic about the methods. With that being said, some consumers may never feel comfortable performing these scans no matter how safe they may be. Some consumers could be hesitant to provide their personal biometrics to large companies, even after understanding the security measures.
For this reason, companies who are eager to switch to the latest and greatest technologies should not make them the exclusive payment option.
Although biometric payments are more secure than other payment methods, there is still a risk of nefarious players entering the biometric payments space. Hackers are always working to find ways to access payment methods.
The emergence of biometric payments is creating a significant shift in financial transactions, offering a unique blend of speed, security, and convenience. Consumers must educate themselves and be ready for the evolution of payments!
