Biometric Cards

Will Biometric Cards Change the Way Benefits are Dispensed?

fsstiprod — Thu, 15 Jul 2021 14:02:39 +0000

Will Biometric Cards Change the Way Benefits are Dispensed? fsstiprod Thu, 07/15/2021 - 19:32

Biometric cards can play a vital role in the proper dispensation of benefits in India going forward, K Srinivasan, Chief Operating Officer, FSS PayTech told ET while speaking about the company's collaboration with Zwipe to bring next generation contactless payment cards to issuers globally.

Srinivasan said that while FSS has not directly engaged with the government, he said the use case for biometrics, especially in a country like India where there is a lot of adoption of biometrics in any case, owing to Aadhaar and Aadhaar-enabled payments makes it a perfect place to use biometric cards for the dispensation of benefits.

"Direct benefit transfer in many countries happens through a card," he explained. " How do you make sure that the right person is coming and taking the benefit? These biometric cards can play a very good role for this, particularly for customers like where we have in Africa, where they use an issuing system, they use cards to dispense pension, for example."

For instance, he said that if one was to transfer money for Covid relief, the biometric card can be programmed to ensure that the card will only function when used by the right person and at the right place, say a ration store rather than a store that sells alcohol. Thus, making it possible to make sure the money disbursed is used for the right purpose and the dispensation mechanism can be centrally loaded.

Srinivasan said that the pandemic has accelerated the use of contactless payments even further as consumers demand a safe, contact-free transacting environment. However, the lack of cardholder authentication with contactless cards translates into usage being restricted to relatively small and medium value payments, hampering the ability to deliver a fully contact free experience for all payment values. The response to this is the biometric payment card that fully enables contact-free transactions while boosting confidence and security for consumers, retailers and issuers.

"Biometric payment cards will bring strong differentiation and value uplift to our card issuance and management offerings. Our collaboration with Zwipe will help our issuer clients to deliver a completely touchless and PIN-free check out experience, better in-store payments hygiene and much stronger cardholder security. Zwipe Pay ONE is recognized as the most advanced (Gen3) biometric payment technology and complements FSS's innovative card portfolio. It will be made available to our clients for piloting and deployment from H2 2021," Srinivasan said.

FSS is a provider of card issuance products globally and its card portfolio consists of 800 plus million payment cards for Tier One banks and payment processors. The organizations will be working together closely and will combine FSS's Unified Issuance Platform and Zwipe Pay One biometric card capabilities, supported by Zwipe's growing global network of card manufacturing partners.

As part of this collaboration, FSS will offer Zwipe Pay ONE biometric payment cards globally. The initial focus will be in those markets where contactless is bringing considerable benefits in the area of financial inclusion as seen in Canada, India and a number of countries within Europe, Middle East (GCC countries) and Africa. Both partners will start engaging with issuers from Q2 2021 and aim for starting pilots from H2 2021, FSS said in a statement.

When it comes to India, Srinivasan said that these biometric cards can play a very vital role, but it is the adoption that is to be seen. For this adoption to happen, a strong ecosystem is the need of the hour. Srinivasan said that there is an ecosystem movement that's happening around biometrics currently.

"For example, Zwipe itself is a FinTech company that focuses on security, focuses on authentication mechanisms which is a very narrow, but deep field that is important when it comes to establishing credible authentication. They are trying to educate all the card manufacturers, they're trying to work with many processes, they're trying to talk about what they can carry out as proof of concept. So, there is a lot of momentum happening around those. The moment that shifts, there will be some sort of regulation, or some sort of adoption driven by the regulators."

He went on to add that in India, hesitation to use biometrics was not a cause for concern as the country has adopted Aadhaar and Aadhaar-enabled payments.

"There are more and more biometric cards that are likely to be issued in 2021in India," Srinivasan said. "And India itself is a country where there's been an extensive use of biometrics, for example, Aadhaar itself is a big part of biometrics. So, it's not about hesitation to use biometric because Aadhaar-enabled payment is itself a classic example of adoption of biometrics."

Research estimates 2.5 million biometric cards to be issued in 2021 and that according to industry reports, biometric payment cards with built-in fingerprint sensors could add $5 billion to revenue in the global banking sector by 2026.

Blog Source : The Economic Times

Are Biometric Cards the Next Normal in Payments?

fsstiprod — Fri, 28 May 2021 06:54:56 +0000

Are Biometric Cards the Next Normal in Payments? fsstiprod Fri, 05/28/2021 - 12:24

Contactless (tap and pay) transactions, over the last year, have become synonymous with safe instore payments. Everyone -- from large retail chains to mom-and-pop neighbourhood stores -- is adopting contactless transactions, as customers are reluctant to handle cash or type in their PINs on devices for hygienic reasons.

Multiple industry surveys have highlighted the impact of the pandemic on cardholder transacting behaviours. A forecast on contactless payments by analyst firm Juniper Research estimates that the value of global contactless transaction will triple from US$2 Trillion in 2020 to US$6 Trillion in 2024. A survey from Mastercard indicates 79% of surveyed consumers worldwide are now using tap-and-go payments, citing safety and cleanliness as the key drivers. As per the Visa Back to Business Study, 48% of surveyed consumers have changed the way they pay, shifting to contactless payments whenever possible. An approximate 26% of the surveyed consumers have used ‘tap to pay’ technology during the COVID-19 for in-store purchase for the first time.

The pandemic-driven rise of contactless payments has contributed to increased activity in the biometric card space. With contactless payments set to grow further, the use of biometric cards will follow along the same trajectory. In fact, UBS analysts project that biometric payment cards could capture a 15% share of the global card market within the next five years. For issuers biometric cards offer a first-mover advantage, help them to differentiate card programs and improve card fee revenues. For instance, French bank BNP Paribas is offering its Visa Premier cardholders the chance to upgrade to a contactless fingerprint option - for a €24 annual fee.

For merchants, biometric cards are designed to be compatible with existing payment terminals that accept contactless- or chip-based payments around the world. As all the information processing takes place within the card, there are no additional support requirements for merchants or acquirers during transaction processing

Around the world, governments and regulators have raised the limits on contactless card transactions, enabling more transactions to take place without the need to touch a PIN pad. South Africa’s ABSA Bank for instance has raised the contactless transaction limit to a maximum US$38 (R500). The UK likewise increased the per-transaction limit from US$40 (GBP30) to US$141 (GBP100), while leading retailers in Australia increased their contactless limit to US$154 (A$200). In India transaction ranges have been relaxed from US$28 (INR 2,000) to US$68 (INR 5,000).

As contactless becomes a preferred payment mode for an increasing number of consumers, concerns around security of contactless transactions have intensified. With raised limits it becomes possible for fraudsters to spend significant sums of money on unprotected contactless cards, even if the theft is reported quickly. As customers do not need a PIN, a lost credit card or a stolen device potentially gives fraudsters easy access to the cardholder’s account. Several incidents have also been reported where hackers have been successful in making fake scanners or using card skimmers designed to steal data transmitted via RFID, enabling them to create cloned cards.

This is a real concern, and issuers must act now to ensure contactless transactions remain safe and bolster consumer confidence. Combining biometric authentication with contactless cards has emerged as a particularly effective solution, since it uses characteristics that cannot be forged and are unique to everyone. Using an embedded fingerprint sensor on-card, banks can add strong customer authentication to contactless, removing the hassle of PINs and the need for contactless payment caps. The sensor that is powered by the chip, authenticates identity through a fingerprint and can be used at EMV terminals worldwide.

Biometric payment cards are poised to become a mainstream payment product and will power a range of use cases

High-Value Transactions - Biometric authentication provides an added layer of security enables the use of contactless for any value payments. FSS recently teamed up with Zwipe for contactless biometric cards and they have successfully demonstrated high-value transactions of up to GBP 100,000. Major banks such as BNP Paribas are among the first few banks to introduce contactless cards for high value transactions.

Balance Convenience and Security - Card fraud has been on the rise throughout the last few years, costing global issuers a projected US$28.65 Billion in 2019, according to The Nilson Report. And the coronavirus pandemic has only worsened the dilemma Fingerprint authentication is a mature and also a preferred technology, having rapidly overtaken PIN authentication to secure payments.

Future-proof Retail - Touchless payment methods are an essential part of the high street’s future. With evolving formats such kerbside pickup, order online and pick up in store, the use of biometric contactless cards would grow. Merchants can enjoy greater certainty of genuine cardholder identity during transactions. As a result, merchants may see increased revenue from reduced false declines or forgotten PIN transactions.

Tap and Pay is now embedded in the daily transactional life of cardholders, as they want to get their shopping done safely, quickly, and painlessly. Biometrics contactless cards, adding a much-needed element of security to these transactions, would have a multiplier impact on value and volume of transactions.