The developing role of biometrics in Banking Technology

calendar_month October 11, 2019

There is a time in the past we saw in science fiction based action movies like James bond where people were identified through biometric data. However, the technological advancements over the last decade have actually made this a reality. We now live in a technology world where our face, voice, eyes and fingerprints can be used to identify and authenticate us in real-time in a few seconds.

While other technologies are making progress substantially, biometric technologies have taken giant strides over the last two decades and are driving towards a day in banking where PIN and PASSWORD would come to an end. We are pretty much-using fingerprint authentication in our smartphones to unlock them just by tapping our thumb on the phone.

Pretty soon we will be seeing the use of biometrics as the way to secure payments across channels be it online or eCommerce and other wide range of financial applications. The recent open banking initiatives and new regulatory frameworks like PSD2 will put financial institutions under pressure to adopt a robust way of protecting customer data and funds. At TrueID, we only see biometrics as a stable solution to address the open banking initiatives by combining security with speed and usability.

We currently see major role of biometrics in banking technology as discussed below:

Card Payments:

Current banking systems are more dependant on PIN and PASSWORD. These are frustrating to users as they are easily forgotten and there are too many passwords for each of us to keep track for multiple uses. Having your fingerprint linked to your bank card is convenient and provides a feeling of security. As user biometrics are stored in the smart cards secure element and not in the bank’s server, customer details are protected even if the bank server is hacked. Even if the card is lost by the user their fingerprint cannot be replicated. The biometric enabled smart cards are playing a vital role in redefining the PIN and PASSWORD days in the near future.

Open Banking Initiatives:

With open banking initiatives coming into Europe, the financial institutions and banks will have to apply multifactor authentication to protect their customer data. Strong customer authentication is the need of the hour. This means in addition to the PIN or PASSWORD banks will need to adopt additional factors of authentication like a fingerprint or facial recognition so on. With fingerprint so widely accepted on mobile devices, many banks have already integrated this technology into their applications. All other banks and financial institutions will soon follow this norm. We at TrueID feel Multimodal biometric authentication will be even more secure than a multifactor authentication. Multimodal biometrics is a combination of authentication of two or more biometric features like fingerprint, Iris and Face.

Behavioural Biometrics:

Biometrics in combination with other recent software advancements like machine learning, artificial intelligence can be used to analyse the patterns of customers like the way they are swiping the phone, the most used feature in banking app, the time they spend on the app so on and bank can adopt these technologies to provide an enhanced user experience as per the need of the customer and can tailor banking products suitable to need of customer based on these advanced biometric behavioural analytics.

Biometrics is definitely playing a development role in banking and once we get through the testing phase and more optimization of technology we will see them playing a much more advanced role. The primary role would be replacing PIN in the banking system for authentication.

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