Mastercard predicts biometric payment boom
07 August 2018 11:26 GMT

There will be a significant increase in the use of biometric payments authentication in the coming months, according to Mastercard.

In order to meet the regulatory technical standards, which come into force next September as part of the European Union’s PSD2 payments legislation, the number of transactions requiring two-factor authentication will rise – paving the way for more biometrics use, according to the card company.

At present, currently just 1-2% of online transactions require cardholder authentication to complete a transaction but this is set to rise to up to 25% payments from next autumn. To meet the push for “Strong Customer Authentication”, payments and account access will rely on the use of two or more different factors: something you know, such as a password; something you have, such as a phone, or card; and something you are, such as a fingerprint.

Mastercard says this switch in regulation will mostly impact card payments completed over the internet. It will also apply to some contactless transactions, as a periodic check to ensure the card is being used by its rightful owner.

In-store chip and pin transactions are compliant, and already use two-factor authentication.

Ajay Bhalla, president global enterprise risk and security at Mastercard, commented: “The use of passwords to authenticate someone is woefully outdated, with consumers forgetting them and retailers facing abandoned shopping baskets.

“In payments technology this is something we’re closing in on as we move from cash to card, password to thumbprint, and beyond to innovative technologies such as artificial intelligence. It’s far easier to authenticate with a thumbprint or a selfie, and it’s safer too.”

Like its competitors, Mastercard said it is working with banks and the rest of the finance industry to ensure new measures are implemented without disrupting the convenience of payments for consumers.

The major theme from this year’s RBTE payments conference stream was that consumers are demanding more flexible, seamless an convenient payments on whatever device they choose to use, be it a card in a shop, mobile or desktop.

For some time, Mastercard has been developing biometric payment authentication – with Identity Check one such example. With this solution, consumers can use fingerprint, iris and facial recognition to verify their identity using a mobile device during online shopping and banking activities.