Biometrics isn’t as sci-fi as it once was. Thanks to smartphones equipped with facial and fingerprint recognition for security, many consumers now have up close and personal experience with newer forms of digital ID.
Innovations — some more fantastical than others — keep emerging, though. Vein recognition? Voice patterns? Old hat. One of the newest forms of biometrics is the sound that an individual’s bones make.
The rise of new authentication methods is one of the driving forces in the growing biometric market. According to new research, the global biometric system market is set to grow at a CAGR of 14.6 percent between 2019 and 2024 to reach $65.3 billion.
With newer, unique forms of digital ID, come privacy concerns.
In the latest Digital Identity Tracker, PYMNTS explores the latest developments in the world of digital IDs, including France’s new biometrics-based ID solution, the declining trend of synthetic identity fraud and the complicated ethical questions surrounding the implementation of digital identity.
Consumer Privacy Sentiment Depends on the Industry
Feelings about privacy and security all depend upon on how personal data is being used, though no one denies the importance.
Mastercard recently introduced a Data Responsibility Imperative to start a conversation with other companies about data security. In conjunction with the new initiative, Mastercard also released a study that discovered the overwhelming majority of individuals and business leaders (90 percent) feel data privacy is universally important.
Malibu Poke, a higher-end quick-service restaurant (QSR) establishment, has rolled out biometric capabilities at its self-serve kiosks. In an interview with PYMNTS, Jon Alexis, owner of Malibu Poke, said the biometric system has proven to effectively retain customers and help them quickly reorder their favorite meals.
Diners can build their own bowls, resulting in more than 63,000 potential order combinations. These self-service kiosks aid in remembering customers’ specific order combinations so they can easily reorder those meals.
Users who approach the self-service kiosks are asked if they are placing a repeat order. The machine offers those who answer yes the option of remembering a previous order either by facial scan or by personally identifiable information (PII) like a phone number or credit card used to place the previous order.
Last month, global payments solution SnapPay announced the rollout of facial recognition payment technology for North American merchants. The technology gives users greater convenience and security when shopping at mainstream retailers.
“Facial recognition technology is an increasingly popular method of payment among global consumers,” said Spencer Xu, CEO and founder of SnapPay. “By enabling consumers to pay with their ‘face’ North American merchants, particularly those with self-service kiosks, are providing an unprecedented level of convenience and speed in the checkout process, to a lucrative customer segment that increasingly demands it.
Biometrics in retail could be just the beginning. There is speculation about the role digitally-read emotions could play in payments and retail. Amazon reportedly is developing a wearable device that is activated by voice to recognize human emotions.
However, the report noted that the project status is not known, and it is uncertain whether it “will ever become a commercial device.” It also pointed out that the company gives wide latitude to teams to experiment with products, some of which never go to market.
Consumers are more amenable to giving up a little privacy for convenience, but only so much. A recent survey found 81 percent of Americans are comfortable using biometrics at airports for security purposes, meaning approximately one out of every five passengers dislike such offerings. That adds up to millions of passengers every year who distrust biometrics, mostly because they do not trust airports or governments with their data.
Forty-two percent of Americans were pro biometrics because of safety and terrorism prevention, though roughly one-third (35 percent) said biometrics is more reliable than older forms of ID, while 32 percent are willing to embrace this tech if it speeds them through the airport faster.
A newer survey found similar sentiments, worldwide. Nearly three-fourths (70 percent) of consumers would be willing to share additional personal info, including biometric data, to speed up airport processes.
Almost half of consumers would prefer biometric ID over passports and one-third would prefer to use biometrics for boarding identification. However, a majority (53 percent) preferring a paper passport said it was because of data security concerns.
Tangible and Ethical Concerns
These concerns aren’t completely unfounded. Synthetic identity fraud continues to grow, but far slower than when it ran rampant in 2015 and 2016. It rose from $1.01 billion in Q2 2018 to $1.02 billion in Q2 2019. The decline in synthetic fraud growth is attributed to greater adoption of fraud protection programs.
Synthetic fraud, which is distinct from most other identity schemes, doesn’t affect all industries equally, though. Synthetic fraud has dropped markedly for most credit products, while auto loans are responsible for the largest amount lost.
In the last year, a lot of questions have been raised about when and where facial recognition tech can be appropriately deployed — and what rights consumers have to their privacy even when presenting a public face.
Ethical issues concerning biometrics extend beyond just personal privacy, though. It can also go the other way and touch on matters of exclusion.
In developing countries, a lack of formal identification can make it difficult for citizens to get services they need. Unbanked or underbanked consumers are also likely to lack the digital IDs necessary to use conveniences like online banking or taxpaying.
According to the ID2020 Alliance, a collaboration between several industry players including Accenture, Hyperledger, Kiva and Microsoft, it could be a civil rights violation if these roughly 1 billion citizens don’t have access to online services or are even able to get vaccines, due to lack of ID.