Biometrics Shape the Evolution of Physical (and Virtual) Cards

As commerce becomes truly omnichannel, consumers are becoming used to wielding plastic and virtual cards. According to Amanda Gourbault, executive vice president, financial institutions at IDEMIA, enhancing the digital services on offer as those physical and virtual cards are launched can make them more attractive to cardholders.

The physical cards, themselves, are getting a makeover. And, as Gourbault noted, there are other trends impacting how we view, and use, tangible cards, whether plastic or metal.

The demand for eco-friendly cards, she said, is “massive. I think we [at IDEMIA] had imagined that we would issue about 10 million this year — but we are in fact going to issue 50 million over that timeframe.”

And metal cards still have their place, she told PYMNTS, as IDEMIA has so far doubled the number of metal cards that were provided, year over year, as measured against 2020. There’s been a bit of a sea change for metal cards, noted Gourbault, where typically only high net worth individuals would have access to those card options. But the advent of the FinTechs has made those cards available to a wider consumer audience (who still prize them for status symbols and as fashion accessories).

“The banks had been doing this for quite some time,” remarked Gourbault, “and more recently … this has been driven by the FinTechs, where they may not have had physical points of contact for their customers.”

We’re in the age, now, of personalization, where issuers are partnering with firms such as IDEMIA in order to let consumers design their own cards in a bid to craft payment vehicles that match one’s lifestyle and personality.

She noted, too, that these cards also have biometric and contactless functionality, and can be wielded at the register (without, of course, having to hand them over, in a physical commerce environment). Contactless limits have been increased, she said, which should give a tailwind for more transactions. “Among the ways of making users feel secure about using these cards for higher value transactions has been the biometrics — [being able to sign a transaction using your fingerprint],” she said.

She stated that though card-present transactions have been relatively safe, fraud has been migrating to card-not-present (CNP) channels. That shift has made it important for issuers and other stakeholders to balance security and convenience, without adding too much friction into the equation (pop-up messages and SMS prompts, she said, add too much friction into the mix).

She pointed to the use of artificial intelligence by issuers to accept transactions based on risk scores.

“That’s the future of the security around online transactions, as commerce goes ever digital,” she said.

Payment Cards — Sans The Numbers

The issuance of numberless cards also adds layers of defense, she said — the cards have no numbers on them when issued — and offers issuers more “real estate” to promote the issuers’ own brands. The brand, she said, is an increasingly important factor for FinTechs and banks alike. Removing  the numbers from the card improves security, but also shows the interdependence again between the card and the mobile channels, as you need to use an application to access the PAN for online transactions

Streamlining services can also improve the time between card issuance and use, maintained Gourbault. IDEMIA  has said that “smart” instant issuance, “smart” PIN and other options can get consumers up and running within minutes.

“Being able to receive my cards digitally before I’ve received my physical card is something that helps our customers [the issuers] and helps their customers — as does being able to set the PIN without calling into the call center.”