Future of Biometrics in Banking & Financial Services

February 7, 2020 Stan

The financial sector is in the process of change by the new forms of communication available in the market. Trends like fingerprint scanner are gaining increasing strength in the financial landscape, causing banks to bet on the integration of all possible channels of communication to satisfy the demands of the client. The authentication of the client and the protection of their identity are one of the most current issues in the banking sector. Faced with security challenges, banks and financial organizations are increasingly considering the incorporation of biometric technology in their platforms.

Biometrics is based on unique physical characteristics (heart rate, blood characteristics such as pressure, protein level, cholesterol, among other traits) and behavioural characteristics. Historically, fingerprint recognition has been the preferred choice in the financial sector.

Over time, the biometric security system is likely to replace personal identification numbers (PINs) for ATM security and other scenarios. This change in the market is occurring faster than initially anticipated, with global biometric bank banking revenue expectations of up to $ 4 billion by 2021.

The wide adoption of mobile equipment with integrated biometric system allows the evolution of biometrics in the banking industry. More and more smartphones and tablets are equipped with biometric scanners for the authentication process inside a mobile banking platform. To cite one example, credit card customers can authenticate payments online by scanning their fingerprints or by a selfie. In this way, users are already prepared for biometric authentication in mobile banking and ATMs.

In relation to Online Banking, there is a greater use of biometric devices to capture Unique Identities at the beginning of the contact. Based on national identity programs, banks use identity credentials extracted from identity cards to provide strong authentication for client transactions. Also, facial biometrics is another tool that allows the digitization of financial activities. Through it, users can verify their identity and conduct banking transactions online. It is a solution that is easy to implement and use, both for the bank and for the mobile banking user, enabling the client to have secure access to the system from a computer or smartphone or with a video camera.

The adoption of mobile banking is booming in the country, while fingerprint biometric identification at ATMs is still in an incipient stage.

Banks are digitizing their operations gradually and responding to the needs of users, who benefit from not having to memorize countless passwords to be able to carry out banking transactions.

The biometric solutions represent, then, a turning point for the security of the banks. In the finance industry, implementing biometric authentication methods is critical to building trust in customers and raising the level of protection in banking transactions. The adoption of biometric technology by banks enhances the end user experience and helps to resist fraud and identity abuse.