Consumer demand for convenience and security is shaping the future of payments, with contactless biometric cards pointing the way.
Mastercard recently announced that it has partnered augmented identity leader IDEMIA and MatchMove, which has been shortlisted by the Monetary Authority of Singapore to qualify for a digital banking license, to pilot the first fingerprint biometric card in Asia to enhance security and safety of contactless payments.
The contactless biometric card that MatchMove is piloting in the region will bring the seamless and intuitive experience of biometric authentication from a smartphone to a smart card.
With a large majority of consumers in Asia Pacific believing the shift to contactless payments is here to stay, the biometric card promises more choice and greater security for consumers that will ultimately shape the future of payments. To provide a better understanding of contactless biometric payments and the future of payments, DigiconAsia sought some insights from Matthew Driver, Executive Vice President, Services, Asia Pacific, Mastercard.
In your opinion, what are some key trends shaping the future of payments in Asia Pacific?
Driver: The shift to digital was already happening before COVID-19 but has now accelerated rapidly and irreversibly as people embrace the benefits and convenience of e-commerce and contactless payments as part of an experience that is safe, secure and seamless.
Contactless transactions have also gained popularity because consumers and merchants have been hesitant to handle physical cash, so going “touchless” has become a natural acceptance option for many.
Consumers now want on-demand products and services – from food delivery and groceries to fitness courses, telemedicine and entertainment. This new mindset sends a clear signal to merchants of all shapes and sizes that going digital with online shopping and touch-free transactions is essential to building the business.
The shifts are also driving further transformation in the payments landscape, which is why Mastercard is investing in strategic priorities that include open banking, real-time payments, business-to-business payments and cyber and intelligence solutions.
Even as the popularity of digital payments soars, the Internet of Things and the deployment of new technical infrastructure such as 5G will rapidly accelerate the availability of ever more convenient payment applications and, in turn, reduce the amount of friction in the economy and our everyday lives.
What are the existing and potential security issues related to contactless payments?
Driver: Contactless technology was developed by Mastercard with the mindset of never sacrificing security for convenience. Consumers and merchants around the world are embracing contactless payments as they see the benefits of convenience, speed, security and safety.
Mastercard contactless transactions are just as safe and secure as any other Mastercard transaction, being based on global payments industry security standards. As such, the technology and the transactions are extremely secure.
With tap-and-go, the card or mobile device never leaves the consumer’s hand as it provides the payment terminal with a unique number – a digital token – that securely identifies each transaction.
As a global technology company handling billions of electronic payments, Mastercard has sophisticated and industry-leading detection systems and artificial intelligence solutions to spot suspicious activity and stop fraud in its tracks. These helped us save $20 billion in fraud in 2019 alone.
Our predictive analytics model helps businesses identify vulnerabilities before they can be exploited and we work with banks, fintechs and other parties to trace and prevent financial crime at a network level for the protection of the entire ecosystem.
How do you address these security issues resulting from this enhanced convenience for customers?
Driver: All Mastercard payment solutions have the same robust, multi-layered and sophisticated security protections that bring consumers peace of mind, enhanced experiences and proper safeguards of data and privacy.
The biometric card has the same EMV chip as any other card, and transactions will be encrypted and authenticated in the same way. It also has the added protection of the fingerprint sensor that enhances the cardholder’s sense of security because, in the event the card is lost or stolen, the biometric on the card will be a strong layer against fraudulent use.
If the cardholder loses the card, the fingerprint data cannot be scrubbed or lifted as the template securely stored on the chip is a numerical representation of the fingerprint image and not an actual fingerprint.
Why pilot a fingerprint biometric card, rather than other alternatives like smartphone-based identity authentication or use of OTP for multi-factor authentication?
Driver: Biometric authentication is a seamless and intuitive experience for many cardholders as they are already familiar with using fingerprints for identity verification on their smartphones.
The biometric fingerprint card makes transactions more convenient, safe and secure by eliminating the need for a cardholder to provide a PIN number, signature or one-time code, thereby reducing touch points in public places and time spent at the cashier.
In our increasingly digital economy and society, authentication is all about the most unobtrusive way to provide the best customer experience, without any trade-off between security and convenience.
While many consumers are happy to use their phones for payments, some still like the convenience of a physical card, so the biometric contactless card offers them an additional security layer.