Financial Inclusion – Impact of Biometrics for Customer Authentication
In the final post in our blog series on Biometrics for Financial Inclusion, Stan Swearingen, Chief Executive Officer at IDEX Biometrics explains the impact of biometrics for customer authentication. The previous post in our series on “Biometrics for Financial Inclusion” looked at how “biometrics can bring groundbreaking progress for financial inclusion?“.
The need for providing financial facilities to the unbanked is one of the most crucial objectives of the financial service providers. This will not only ensure easy access to banking solutions for the non-bankable but also significantly increase the number of new customers for the banks. With biometric authentication systems such as fingerprint verification, the banks and financial institutions will be able to develop a system based on trust and security and serve the unbanked better. The system requires the user to be physically present when making transactions or paying bills reducing the chances of any duplicity as it is almost impossible to simulate a unique fingerprint. Additionally, the cost of deployment and maintenance is also relatively low compared to management of the PIN system. This will lead to lower cost of services for the consumers making it all the more feasible to reach the unbanked.
According to a recent report by Infosys, only 9% of people in low-income countries use their mobile phones to make transactions and over 50% of the world’s working population does not have proper access to financial facilities. So what can be the potential reason for this lack of accessibility? Many have literacy barriers and many consumers are unable to produce enough credentials that comply with the bank’s terms and conditions.
With a system as effortless as an impress of a finger, many banks and financial institutions are already considering fingerprint recognition technology to authorize auser’s identity. After successfully completing multiple customer trials and launches in Africa, Middle-East countries and Asia, leading fingerprint sensor providers are already in the process of supplying sensors for the roll-out of biometric-enabled payment cards . However, this major financial breakthrough will take some time to reach the unbanked since many governmental bodies are yet to understand and execute the system. Stan Swearingen, CEO of leading fingerprint sensor technology provider, IDEX Biometrics affirms, “To address the issue, biometric companies are already working alongside card manufacturers and financial institutions, paving the way for biometrics to have a real impact on financial inclusion over the next two years. Providing almost a third of the world’s population with greater financial inclusion is a significant challenge that will not be accomplished over night, but these advances in biometric technologies are set to make a real difference.”
The previous post in our series on “Biometrics for Financial Inclusion” looked at how “biometrics can bring groundbreaking progress for financial inclusion?“.