How do you define a biometric payment card? And how does a biometric card work?

 

Biometric payments card  the future of payments

Biometric payment cards are currently being trialled in a number of European banks. The main benefit of using a biometric card is security; instead of entering a PIN code when making a purchase, you simply touch the fingerprint reader on the front of the card, match it with the stored fingerprint, and pay. Since fingerprint data is always stored on the card, it cannot be stolen or intercepted.

 

Biometric cards have no contactless transaction restrictions, and once biometric payment cards are introduced, customers can begin using them by recording their biometric data to the bank's sensor devices. The biometric authentication data will be stored only on the biometric card, any central database will be without the user's data information.. Even if the card is lost, the user's identity will not be stolen, and no other entity can use the card for fraudulent activity.

 

This goes without saying, but smartphones are all over the place with these. In fact, in 202 1, there are users using biometric payment cards that are estimated to equal 48.5% of the world's total population. For these consumers, smartphones have become the default way to perform important daily tasks; from ordering food and buying clothes, to accessing online accounts and paying for goods in-store.    

 

However, while mobile payments offer convenience in the long term, not everyone is a mobile payments user - in 2019 an estimated 950 million people will be making mobile payments transactions. This number is relatively small compared to the number of smartphone users. 

What's more, because in mobile phones he is not a universal payment device for example, it is not accepted everywhere and relies on batteries, most mobile payment users also have a bank card as a backup. Therefore, it is critical to continue to innovate and improve bank cards so that this part of the financial services industry can meet the needs of the 3.8 billion people worldwide who want increased security and convenience when making physical transactions.

Why biometric cards are the way of the future

Benefits of biometric payments

 

• They have built-in robust security mechanisms

With the rise of financial services fraud, such as phishing attempts or PIN tracking, people are increasingly worried about being targeted by malicious actors and losing their hard-earned money. Indeed, in 2019, the percentage of people in EU countries who have been defrauded through their bank or online banking is around 67 percent

In light of this, it is important that banks, in order to provide consumers with peace of mind, have developed the ability to embed fingerprint authentication into bank cards, with the creation and use of biometric cards with fingerprint sensors, based on the respective different user characteristics to verify that they cannot be copied.

• They are convenient and easy to use

For consumers who are used to purchasing what they need at the click of a button, any additional security measures on the bank card must also be extremely convenient.

 

Beyond basic security measures, additional levels of security Biometric bank cards unlock additional usage features such as the ability to remove restrictions on contactless payment transactions. Using the biometric  authentication assessment and authentication, security should be at least as good as entering a PIN, where we use biometric authorization for payments, people can pay for high-value items via fingerprint authentication, which does not compromise security.

In addition, as with contactless transactions, with biometric cards, users can simply place their device near a point-of-sale terminal to verify their purchase.

In terms of fingerprinting the card, it is also a quick and easy process that can be done in minutes at home or in a branch, and only needs to be done once. The card is inserted in a small sleeve (with the card) that runs the energy of the registration process in the provid ES. Then, all the LL cardholder has to do is simply present a finger sensor for a few moments to capture all possible angles and details of the fingerprint. After the green light on the card confirms the registration, the user only needs to enter his/her password again in the first biometric transaction to verify and complete the operation.

 

• They are designed to provide enhanced data protection

 

Fortunately, these new generation cards have data protection at their core. When enrolling fingerprints, consumers can rest assured that fingerprint reference data is only stored in the card's secure chip. This does not include any biometric data, but rather a mathematical transformation of unique points that represent your fingerprint reference data. It is not possible to reconstruct a fingerprint image from this data, which means that even if your card is stolen, a malicious actor will not be able to copy your fingerprint.

 

In addition, personal data is not stored on the bank's servers and is not sent wirelessly to a central database. If the card is lost or stolen, the customer will need to re-register his fingerprints when he receives a replacement card. 

 

Another advantage is that banks can rely on secure cardholder identification and benefit from increased trustworthy transactions, reducing cumbersome false rejections for users. 

According to PCM's latest Digital and Card Payments Yearbook report, payment cards, particularly contactless payment cards, will dominate the banking industry until at least 2025, providing a ready target market for biometric payment card manufacturers.

This forecast contrasts with recent predictions by Global Data Payments analysts, who said the momentum behind digital wallets makes widespread adoption of biometric payment cards unlikely.

According to the new report, there are nearly 1.12 billion cards in circulation in the 33 countries surveyed by PCM. That number represents a 4.83 percent increase over 2020.

 

In addition, the adoption of contactless cards as a payment method reached as high as 73 percent of all card transactions globally last year, apparently driven by the pandemic's necessity for contactless payment solutions.

The report mentions that Europe's bank branch network continues to decline at a rate of around 6% per year as more financial institutions move to purely digital solutions.

 

These include voice biometrics, facial authentication and two-factor authentication via PIN or remote location biometric factors.

In terms of fraud trends, new PCM data shows a significant increase in account takeover and user impersonation during the pandemic, requiring more secure digital ID solutions.

 

Several financial institutions and companies have begun to explore the potential of biometric payment cards as a result of the steady adoption of payment cards in several European countries and the apparent reduction of traditional bank branches across the continent.

With the growing popularity of biometrics in the payment card industry, consumers can benefit by

It is widely regarded as highly secure compared to the popular PIN code and the algorithms used for it are the most accurate in terms of identity verification.

Payment cards can be easily set up from a bank or home using a biometric scanning device.

• Easier to use without a PIN code
• Seamless and almost instant payment authorization process.
• Ensures privacy by keeping the user's credentials on the card and ensuring they never leave the card
• Can promote higher value for contactless purchases in retail stores and increase profitability for brick-and-mortar stores
• Does not require batteries to work.
• Compatibility with existing point-of-sale terminals
• Better protect your data

Unlike PINs, fingerprint data is encrypted and stored only on the card, eliminating the need for a central database connected to the Internet, thus protecting the card user's sensitive data from hackers. In addition, the technology prevents duplicate 2D fingerprints and rubber fingerprints, which require capacitive sensing.

• More Convenience

Credit cards can save consumers time and allow them to pay quickly. For EMV PIN and chip cards, remembering the PIN slows down the process. Using fingerprint authentication can speed up the process and reduce friction in the payment process. 3.

• Works with existing POS infrastructure

Biometric credit cards can be used at any EMV-ready payment terminal without modifications to existing point-of-sale equipment. This means there are no rollout costs for merchants and the technology can be accepted quickly.

 

Looking ahead, biometric technology continues to improve and evolve in terms of speed and accuracy. It helps break down potential barriers for users and fosters a sense of security around this method of payment identity verification.

 

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