Will Biometrics Replace Plastic Cards?

April 28, 2019

Will Biometrics Replace Plastic Cards?

Biometric technology is everywhere – from smartphones to buildings, onto schools and even airports. So the natural next step for biometrics seems to be banking.
Indeed, with Apple having launched fingerprint biometrics way back in 2015, and facial recognition for payments with the launch of the iPhone X in 2018, banks and card processers aren’t just under pressure to keep pace, but must actually catch up. Let’s look at how the land lies for banking biometrics in 2018.

For banking, biometrics has already arrived
We may not yet fully realise it, but there are already a multitude of ways in which we can bank by biometrics. Barclays customers can instruct Apple’s Siri to make a payment [1]; Santander customers can use just their voice to make payments, check their balance, explore spending, and report lost cards [2]; and First Direct customers can already log into their banking app by fingerprint [3].
Yet while there are many success stories of biometrics in banking, others seem to have fallen flat (despite them being more ambitious). One such example includes Halifax, which trialled electronic wristbands that tracked their customers’ unique heartbeat to verify them at the till [4]. While the tech was proven to work, Halifax later said that they wouldn’t forging ahead with it.
Currently it appears that the most promising upcoming development for biometrics in banking is the use of facial recognition – something that Lloyds is trialling on Windows 10 [5], while HSBC has already rolled it out for corporate customers in the US, UK and China [6].

Biometrics – Testing, testing
In the rumour mills of the financial world, the topic of card biometrics began making the rounds in 2014, with a select number of media outlets reporting this technology to be launching in the coming year. So why are we still waiting? As it turns out, this date wasn’t so ambitious, as it would have followed a successful trial by Mastercard that completed in Norway in 2013. But it appears that more development and testing was required, as a further trial in South Africa launched in April 2017, following with even more trials in Bulgaria later the same year.
Mastercard’s lifelong rival, Visa, are also busy testing, having partnered up with the national bank of Cyprus in a wide-scale trial involving tens of thousands of biometric cards.
Both card companies expect biometrics to reach us sometime in the coming couple of years.

Here’s what the (not-so-distant) future looks like
For sci-fi fans, the future of card payments looks remarkedly like they have always done; with bank cards of the same shape and size as always, but with the addition of a biometric scanner positioned in the top right-hand corner. For Mastercard, we know that each card will be able to accept as many as four fingerprints (the only minor inconvenience will be a trip to a bank branch in order to register them).
These cards will overcome the spending limit of contactless cards (which is set at £30); and, crucially, they’ll also overcome some of the security holes that PIN and contactless technology left wide open (such as someone peering over your shoulder or going on an under £30 spending spree).

Where next, for biometrics?
As banks and card companies scramble to be the first to launch the next generation of biometric banking, it seems that only one thing is for certain – that, for now at least, there will be a need for an app or card to act as the go-between technology and the till.
When Mastercard and Visa finally launch their flagship biometric cards, it could well be that we see a resurgence for card use over payment apps. Perhaps they may even re-gain some of the ground lost to apps such as Apple, Google and Samsung Pay.

1. https://www.telegraph.co.uk/money/consumer-affairs/hey-siri-pay-aunt-maud-150-barclays-launches-first-voice-activated/
2. https://www.telegraph.co.uk/business/2017/02/13/pay-speak-santander-revamps-voice-banking-app/
3. https://www1.firstdirect.com/1/2/banking/ways-to-bank/mobile-banking-app/android-fingerprint
4. https://www.telegraph.co.uk/finance/personalfinance/bank-accounts/11469107/Forget-your-bank-PIN-Halifax-trials-technology-where-customers-are-recognised-by-their-heartbeat.html
5. https://www.finextra.com/newsarticle/30436/lloyds-partners-microsoft-to-pilot-facial-recognition-access-to-online-banking
6. https://www.ft.com/content/acc823c0-52a6-11e8-b3ee-41e0209208ec