IBS Journal September 2015
Face/Off: banking’s biometric innovations
Competitors in the banking space are always looking at avenues in which to get ahead and none has shone so promisingly to them, it seems, than that of biometrics and mobility. In the past month there have been multiple trials of new and innovative ways for customers to make their transactions and to send and receive payments and cash.
Heartbeat Tech firm Nymi, with the support of Master- card and Canadian banking group TD, has developed what it claims is the world’s first wearable payment system to authenticate the user via their heartbeat. Nymi, based in Toronto, has launched a pilot phase with 100 bracelets supplied to TD Bank customers in Toronto, Ottawa and Regina. The initial prototype is NFC-com- patible (making it completely contactless) and is linked to the wearer’s Mastercard credit card. Able to detect the wearer’s unique electrocardiogram pattern (the reg- ularity of their heartbeat), the band uses this biometric data to authenticate contact- less payments. The biometric bands gained £8.98 mil- lion in a funding round last year largely supported by Mastercard. The multination- al finance firm might be looking to throw its hat into the contactless payments ring following Apple’s Apple Pay launch in July this year. According to Nymi CEO Karl Martin, the goal of the project is to ‘ fundamentally change the way authentication is treated’. Electrocardiogram-based authentication, he adds, is the new way to securely access goods and services and make retail payments.
Facial recognition (aka selfies) Mastercard has also got on board with fa- cial recognition, by starting pilot programs in the US and the Netherlands which will use the technology to allow customers to verify mobile payments with a selfie. The trial, in which Mastercard is working
alongside International Card Services (ICS), will see 750 ABN Amro users swap their pass- words and PINs for fingerprints and facial rec- ognition. Participants in the three month trial will be able to download an app which will open a fingerprint or picture window when the trialist enters a web store checkout.
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Arjan Bol, country manager at Master-
card Netherlands, reckons that the test will prove that biometric methods improve the speed and safety of online payments. ‘What is easier and more fun,’ he asks, ‘than pay- ing through a selfie or fingerprint?’ In the US, 200 participants will test
a ‘selfie pay’ system that will be used to verify their identity via the popular por- trait method. Payments will be made in the form of virtual donations to the char- ity Children’s Miracle Network in order to track the security and convenience of the new system. According to Mastercard’s own
research, three quarters of people have heard of biometric payments, with finger- print scanning being the most commonly recognised form of authentication.
Vein patterns Taiwan’s CTBC Bank, meanwhile, has un- veiled a new pilot ATM equipped with the latest in biometric technology to enable it to recognise customers’ faces and the veins in their fingers. Users of the ATM will be able to with-
draw funds and perform transactions with- out the need to use either their card or PIN. The finger scanning technology – named VeinID – has been pioneered by Japanese company Hitachi and scans the pattern of a user’s veins within their fingertips.
© IBS Intelligence 2015
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According to the creators, vein patterns
are far harder to replicate than standard finger - prints. On top of this (and rather morbidly) the scanned finger must also be attached to a live body for the scanner to work. CTBC Bank has launched the pilot pro-
gram as part of its emerging digital services strategy, which has also furnished the firm’s financial park in Taipei with biometric scan- ners for employees. VeinID and other biometric techniques
are a growing part of many banks’ digital strategies. Earlier this year the NCR Corpo- ration introduced cloud-based ATMs run- ning on Android devices equipped with finger scanners. CTBC Bank’s digitised ATMs and the oth-
er facets of its biometric pilot are still awaiting regulatory approval as well as the consent of customers, however, before the bank can consider a more widespread implementation.
What’s the verdict? Whether selfies, facial recognition or vein-scanning, biometrics are certainly going to be part of the future for retail banking in particular. Whether they’ll become the norm is a different question entirely, especially as most pilots are in their very early stages. Perhaps in 15 or 20 years the PIN will go the way of the written signature? Only time will tell.
Alex Hamilton
ibs news
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