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BIOMETRICS MONTH: Balancing privacy and the need to combat fraud

Biometric technology, which measures and analyses human physical and behavioural characteristics for authentication purposes, has become a linchpin in the fight against fraud. Here, we’ll explore the multifaceted applications of biometrics in deterring fraudulent activities, its integration into security systems, and the benefits and challenges it presents…

Traditionally, security measures relied heavily on knowledge-based authentication methods, such as passwords, or token-based methods, like ID cards. However, these systems are vulnerable to various forms of fraud, including phishing, identity theft, and social engineering. Biometrics, by contrast, offers a more robust solution by providing a unique, immutable identifier – the human body itself.

One of the most widespread uses of biometrics for fraud prevention is in the banking and financial sectors. Fingerprint and facial recognition technologies are increasingly integrated into ATMs and mobile banking applications to verify transactions and reduce the incidence of identity fraud. In 2016, HSBC rolled out a biometric banking system in the UK that allowed customers to use fingerprint and voice recognition for account access. This system ensures that only the authorized user can conduct financial operations, significantly lowering the risk of unauthorised access.

Moreover, in retail and e-commerce, biometrics is used to secure payment processes. Apple Pay and Samsung Pay use fingerprint and facial recognition to authenticate payments, making it more difficult for fraudsters to use stolen credit card information. The biometrics tied to these mobile payment systems add a layer of security that is particularly difficult to breach since it requires the physical presence of the individual.

Beyond financial transactions, biometrics is also increasingly crucial in border control and immigration. Airports around the world have started using biometric passports and eye scanning technology to confirm the identity of travelers. This not only speeds up the authentication process but also thwarts attempts to enter a country on fraudulent documents.

Biometric technology also plays a significant role in cybersecurity. By integrating biometric logins into their systems, companies make unauthorized access more challenging. For example, multi-factor authentication systems that include biometrics add an extra security layer that a password alone cannot provide.

Despite its advantages, biometric technology is not without challenges. Concerns regarding privacy and data protection are paramount, as biometric data, if compromised, cannot be replaced like a password. Furthermore, there is a continuous technological arms race between security experts developing more advanced biometric systems and fraudsters finding new ways to spoof these biometric markers.

The use of biometrics in combating fraud has shown considerable promise across various sectors. Its ability to provide secure, user-specific authentication serves as a strong deterrent against fraudulent activities. However, the adoption of biometric technology must be balanced with strict privacy controls and continuous technological advancements to stay ahead of fraudulent schemes. As biometric systems become more sophisticated and widespread, they are set to become a cornerstone in the ongoing battle against fraud.

Are you researching Biometric fraud protection solutions for your organisation? The Merchant Fraud Summit can help!

Photo by Onur Binay on Unsplash

Do you specialise in Biometrics for Fraud Detection or IP Intelligence/Proxy Detection Solutions? We want to hear from you!

Each month on Merchant Fraud Briefing we’re shining the spotlight on a different part of the market – and in November we’ll be focussing on Biometrics for Fraud Detection & IP Intelligence/Proxy Detection.

It’s all part of our ‘Recommended’ editorial feature, designed to help industry buyers find the best products and services available today.

So, if you specialise in Biometrics for Fraud Detection or IP Intelligence/Proxy Detection and would like to be included as part of this exciting new shop window, we’d love to hear from you – for more info, contact Jennie Lane on 01992 374 098 |

Here’s our 2023 Features List in full:-

November – Biometrics for Fraud Detection & IP Intelligence/Proxy Detection

December – POS Verification & Chargebacks

For more info, contact Jennie Lane on 01992 374 098 |

Banking & financial services driving renewed growth in biometric hardware

Global biometric device shipments fell from 4.1 million in 2019 to 3.4 million in 2021 and recovered slightly to 3.6 million in 2022, with global trends impacting usage in banking, financial services and insurance (BFSI) sectors.

According to a new report by technology intelligence firm ABI Research, geopolitical and macroeconomic events, including the conflict in Ukraine, the shortage in semiconductor supply, and downturns in supply chains, have resulted in turbulent market dynamics over the last few years.

It asserts that with a CAGR of 11.3%, fingerprint recognition will expand from 1.7 million to 2.9 million shipments in 2022 and 2027 to claim the lion’s share of the biometric modalities market.

“However, due to simplicity and the expanding use of liveness detection, facial recognition biometrics will experience the fastest growth over the same period, with a CAGR of 11.9%.” says Sam Gazeley, Digital Payment Technologies Analyst at ABI Research. “In terms of biometric hardware technology shipment share, ID/Authentication will account for 64% of the BFSI market in 2023. This is partly because, aside from smartphone-centric biometric technologies, user registration and authentication are the key use cases for biometrics in the BFSI sector.”

“Exacerbated by the increasing integration of biometrics in mobile banking apps and with more customers turning to mobile banking apps, several BFSI businesses are including biometric authentication methods like fingerprint and facial recognition in their solutions. While this applies predominantly to the smartphone industry, the BFSI market’s growing use of biometrics will encourage the deployment of biometric hardware in branches.

“The customer experience as it relates to the client authentication processes is being streamlined by deploying biometrics such as fingerprint and facial recognition, which improves the entire experience with BFSI services and combating fraud by eliminating the need for passwords.”

However, it is also important to remember that branchless banking is growing in popularity and will limit the accessible market for biometric hardware providers as we enter the forecast period, particularly regarding neo and challenger banks.