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Although biometric technology has been available for a number of years, many financial services organisations have only started taking it seriously since the beginning of the pandemic. The necessity for remote customer onboarding and evolving technology in this area have made biometrics a critical identity verification option for financial institutions.
In this article Barley Laing, the UK Managing Director at global data quality and ID verification business, Melissa, will outline why facial verification is set to be the standout biometric technology for financial services in 2022.
Fraud on the up in the digital age
Biometrics is becoming increasingly important as the growth in digital engagement has led to a corresponding surge in fraud. In the banking sector, UK Finance found that in the first half of 2021 criminals stole a total of £753.9 million through fraudulent activity, an increase of 30 per cent compared to the first half of 2021.
Biometrics offers improved security and customer experience
It is biometric technology that identifies a person’s physical characteristics, such as fingerprints, or behavioural characteristics, such as activity on a tablet, which is leading the way in verifying someone’s identity in the digital age. In theory, these unique identifiers cannot be replicated, avoiding the need for time-consuming security questions or often forgotten passwords.
Therefore, adopting biometric technology helps to deliver a positive customer experience, by enabling people to avoid the frustrations they usually face when using traditional, and sometimes less secure methods – such as passwords – to access their accounts.
Why facial verification is the biometric technology for 2022
Facial verification is proving to be the leading form of biometric technology today. It simply works like this: at the onboarding stage, once an applicant has scanned and forwarded their primary ID document that includes a photo (such as a passport or driver’s licence), via a device of their choice, Machine Readable Zone (MRZ) and Optical Character Recognition (OCR) technology check its validity in real-time. Then the applicant takes a selfie with their smartphone, which the software scrutinises via an algorithm within the technology, comparing it with the master ID image. The algorithm can provide exceptional matching accuracy by instantly distinguishing differences between the selfie and the ID image, including head position, hairstyle, skin imperfections, facial hair, makeup, and age.
Facial recognition is reaching maturity, particularly with the addition of liveness checks, setting it apart as a must-have in the biometrics space. Biometric technology that applies facial verification delivers liveness checks to prevent ‘spoofing,’ which involves criminals using creative methods, like 2D images and video playback, to trick the technology and prove they are the person they are impersonating. Therefore, facial verification technology that offers a ‘challenge-response,’ by asking the individual to blink to confirm eye movement and proof of life, can establish whether the person is real and not a static image.
With the addition of liveness checks, facial verification is quickly establishing itself as the standout approach for prospective customers and existing account holders to swiftly and securely pass through the ID verification process – enhancing the customer journey.
Facial verification at ATMs
It’s not only in remote onboarding where facial verification has an essential role in banking. Many financial services organisations are currently investigating its application in how it could work with ATM technology.
Placing cameras around an ATM provides the opportunity to ‘read’ the face of an individual looking to withdraw money. Once the cameras have verified the customer’s identity, they can then withdraw the funds they need without a card or PIN. It’s a service that forward-looking financial institutions such as CaixaBank in Spain and OCBC Bank in Singapore already offer their customers.
It’s also worth bearing in mind that similar facial verification technology is already leveraged successfully at eGates in airports to speed processing at immigration.
Security issues with other biometric technology
Facial verification biometric technology is leading the way in the biometrics space because it’s nearing maturity by solving evolving security issues such as ‘spoofing’. Biometric technology in other areas simply isn’t at the requisite level to confidently confirm identity on their own. This includes behavioural biometrics, which identifies unique patterns in human activity, such as recognising the behaviour of someone using a tablet or mouse. Additionally, biometric technology using other physical characteristics, like voice, is also lagging because of vulnerability to spoofing.
Fingerprints, which initially appeared to be in the box seat as a form of biometric ID verification, have recently encountered security issues as fraudsters become savvier. There have been increasing incidences where hackers have stolen and replicated fingerprint data for deceptive purposes. Fingerprints can also sometimes be a struggle to read accurately, depending on climatic conditions and a dirty screen.
Until these other areas reach maturity and security issues have been ironed out, facial verification – offering liveness checks – is set to be the standout biometric technology for the financial services industry in 2022.
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