IDEX Biometrics: Why Adding Biometric Authentication to Metal Cards Will Boost Their Opportunity

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Why Adding Biometric Authentication to Metal Cards Will Strengthen Their Opportunity

In the second article in our series on metal cards, we discuss the benefits of adding biometric authentication to payment cards. Suppliers will be able to effectively weed out fraudulent abuse and thereby build vital consumer confidence in their product.

For payment providers looking to attract high-value customers with style in mind, the metal payment card is an increasingly popular choice. Crafted in sleek, minimalist designs from durable metals such as titanium, metal payment cards could become the new high-level “must-have” accessory. However, with the risk that these cards will also be targeted by criminals, it is essential that strong security measures are considered.

Threats to the use of payment cards

Unfortunately, figures show that payment card fraud is a serious problem, with the cost of such criminal activity reaching £261.7million in the UK in the first half of 2021 alone, according to statistics from UK Finance . [1] This extrapolates to over £500m for the year, assuming similar levels for H2 2021. Of this H1 2021 figure, £19.5m relates to contactless/presentation fraud. card. It’s entirely reasonable to fear that these coveted new metal cards could be a prime target for criminals hoping to misuse them. After all, a metallic card could be an indicator that the cardholder has a high credit limit, and contactless payment technology would allow fraudsters to use them for many transactions unchallenged.

Biometric authentication can solve this problem

However, there is already proven technology to secure these new metal contactless payment cards. By including biometric authentication in cards, card providers can reduce fraudulent abuse and foster vital consumer confidence in their product in the process.

This authentication, in the form of a fingerprint sensor, is built into the payment card and encrypted to match only the unique fingerprint of the card’s authorized user. Bringing convenience and peace of mind to the cardholder, the sensor is also cost effective for card providers, making it an attractive solution. Indeed, the use of a fingerprint as a means of authentication is already familiar to many consumers, who already use this technology to secure their smartphones and tablets.

Other advantages

It’s not just the security benefits that can make opting for embedded biometric sensors a smart business decision for card providers. With this technology, providers can unlock the potential to provide a myriad of other useful services in every card, ranging from payments and travel passes to loyalty programs and even providing some form of identification. .

This ability to make the payment card a versatile and unique tool for everyday life can be a great way to build valuable brand loyalty and build long-term financial relationships with consumers, especially those in the younger demographic. who are especially likely to be attracted to a “tap and go” card that works in many different situations. Indeed, the convenience offered by biometric authentication methods makes it possible to speed up transactions, without the need to use a PIN code, and to remove the limits of contactless payments.

A desirable solution for all

It is clear that not only can fingerprint authentication technology provide the stringent security measures needed for metal payment cards, but it can also be used as a key factor in attracting affluent customers. With so many benefits to enjoy, from increased speed and convenience to loyalty programs, card providers will surely be looking to integrate this technology into their product to provide the best possible customer experience.

Metal card providers are targeting the contested youth demographic space. According to a Federal Trade Commission report [2], millennials are 25% more likely to report incidents of fraud than older cohorts aged 40+. Whether it’s lifestyle choices or simply increased economic activity among a more diverse array of traders, the statistics certainly suggest high vulnerability in a key target group that adds weight to the argument for the addition of secure biometric authentication.

In the next blog post, we’ll discuss how challenger banks appeal to younger audiences.

[1] https://www.ukfinance.org.uk/system/files/Half-year-fraud-update-2021-FINAL.pdf

[2] https://www.ftc.gov/news-events/blogs/data-spotlight/2019/10/not-what-you-think-millennials-fraud

About Roberto Frank

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