Why Biometrics Is Replacing PINs
The traditional payment card system is outdated and leaves users vulnerable to fraud. This is because non-biometric payment cards are not intrinsically linked to the bearer, making it easy for unauthorized users to access them. Moreover, vulnerable individuals such as those with dementia, learning difficulties, or impaired vision, may struggle to remember their PIN or enter it into a card reader when needed, leading to financial exclusion.
Fortunately, the solution to these problems is already available. By integrating fingerprint sensor solutions into payment cards, financial institutions can ensure that payment cards are used only by authorized users, and provide a convenient way for vulnerable minority groups to access modern payment methods.
An Outdated System
The chip and PIN method of authentication has been relied upon by financial institutions for too long. The PIN allows a card user to make payments and transfers once a four-digit code is entered into a card reader, with a signature on the back of the card as the only attempt at providing a “multi-factor authentication” approach. For contactless payments, no PIN or verification method is needed at all. It’s clear that the result is far from fit for purpose.
In addition to the problems associated with fraudulent misuse of payment cards, the Chip and PIN system effectively excludes a sizeable proportion of society. Vulnerable persons such as those with dementia, learning difficulties, or impaired vision can struggle to remember their PIN or to enter it into a card reader without any sensory barriers. This contributes to the lack of financial inclusion —a major problem in today’s increasingly digitized society.
Fighting the Risk of Fraud
Fraud is another reason for financial institutions to make the switch to fingerprint sensor solutions. The number of victims of credit card fraud in the US alone is anticipated to rise to 150 million in 2023 [1] and the median value of these fraudulent transactions also increasing. Without any means of effectively verifying the cardholder’s identity, this is a worrying trend that will not end while we remain reliant upon PINs. Secure, accurate and simple authentication is needed to provide a simple way to make transactions as well as to reduce the losses to fraud each year.
Choose Fingerprint Sensor Solutions
Integrating a fingerprint sensor into payment cards addresses the challenges of fraud and financial inclusion in tandem.
The sensitive biometric data is held securely on the card itself, eliminating the risk of hacking, and each payment card is intrinsically linked to its authorized user. Transactions are easy to make by simply touching the sensor, providing a convenient and secure method of payment. By choosing fingerprint sensor solutions, financial institutions can ensure that payment cards are used only by authorized users, improve financial inclusion, and reduce the sums lost to fraud each year. It’s time to say goodbye to the outdated PIN method once and for all.
[1] https://www.security.org/digital-safety/credit-card-fraud-report/
