Biometric Payments Could Soon Become Commonplace

Using irises or veins to buy goods is less futuristic than it might seem

Author: Krista Garcia

July 27, 2018

Biometric payments—scanning an iris or veins in a palm—seem like science fiction, but it's a growing reality around the world. 

Due to the ubiquity of smartphones, the need for faster and more accurate logins has arisen and using fingerprints rather than typing passwords is now an accepted norm. Payments using biometric markers is a logical next step, but mobile payments in general haven't swept the nation. 

We forecast that around one-quarter of US smartphone users will use a mobile phone to pay for a purchase at a physical point of sale (POS) at least once every six months in 2018.

According to a Transaction Network Services (TNS) and Kantar TNS survey of consumers in the UK, the US and Australia in March 2018, just 14% of US respondents said they had made a biometric payment in the past year. Overall, more men than women had used this tech (19% vs. 12%), and younger consumers were more willing to experiment with it. One-quarter of 18- to 24-year-olds thought biometric payments would be acceptable, compared with just 3% of those 55 to 64.

Not surprisingly, consumers were most willing to use fingerprints as an ID, cited by 56%. Around half were OK with iris (51%) and facial recognition (50%), while veins in a hand had the lowest acceptance (42%).

It's likely that most consumers in the US hadn't used fingerprint recognition until smartphones began integrating that feature. The iPhone X kicked off the mainstreaming of facial recognition for logging in. Now Samsung offers "Intelligent Scan" on its Galaxy S9 and S9 Plus models, which uses a combination of iris scanning and facial recognition. 

In a Visa survey from September 2017, most US internet users were aware of these biometric recognition technologies (with the exception of vein recognition). But only fingerprint ID was used regularly by a substantial amount (35%). Voice recognition had been used by 41% of respondents at least once. 

Voice recognition was not included in the TNS survey, but that's a unique identifier that could have legs since consumers have become comfortable using smart speakers and voice assistants. According to a November 2017 Capgemini survey of people in Western Europe and the US who use virtual assistants, 28% said they had used one via a speaker or smartphone to make a payment or send money

There is a degree of pent-up demand bubbling under the surface. Nearly one in five internet users worldwide in an iVend Retail study indicated a desire for biometric ID and payment when asked which emerging tech they would like to see their favorite brands offering. 

Even if biometric payments are still in the experimental phase, 66% of US consumers in the TNS study thought the technology will become more commonplace in the next two to five years. 

Juniper Research estimates that 80% of smartphones worldwide will integrate biometrics by 2023, authenticating $2 trillion worth of mobile payment transactions annually, up from $124 billion expected this year.