According to ZDNet MasterCard will implement Pay-by-selfie and Pay-by-fingerprint authorization capabilities for online purchases later this year, which will hopefully help slow down the increase in online fraud:
“MasterCard is rolling out its new mobile payment verification services, pay-by-selfie and pay-by-fingerprint, this year in Canada, the US, and the UK.
The company hopes to simplify the online shopping experience for MasterCard holders at a time when retailers are beginning to complicate it with extra security measures at checkout.”
The implementation appears straight forward and simple for the consumer and market research appears to indicate consumers do like the new service:
“MasterCard’s new platform, called the Indentity Check app, gives its cardholders the option to pay with a selfie, as an alternative to the fingerprint. MasterCard holders at participating financial institutions can install MasterCard’s the Identity Check app on their mobile devices, but it will only work for online purchases, not at physical retailers.
Late last year, MasterCard ran concurrent pilots in the Netherlands and the US. Over three months, 750 ABN Amro Bank customers in the Netherlands and 240 employees of California-based First Tech Federal Credit Union participated over two months. Participants could choose between using selfie or fingerprint authentication.
Combined data from both pilots show that 92 percent of all participants thought Identity Check was more convenient than typing in passwords, and 83 percent believed it was more secure.
Overall, 93 percent said fingerprint authentication was convenient, and 71 percent rated facial recognition as convenient.”
Of course these consumers are Dutch and have faced a level of complexity for online payments unlike anything seen in the US:
“Since most of the participants came from the Dutch pilot, MasterCard’s test data represents the Dutch consumer more than it does the US one. But Dutch consumers have characteristic banking habits that don’t match those of North American or UK consumers. So how much does this data tell us that Instant Check will succeed in North America and the UK?
“Security is as much of an issue in the Netherlands as it is in the UK and in the US as well,” says Ajay Bhalla, president of enterprise security solutions at MasterCard.
Still, the Dutch participants in the pilot were already burdened with more complicated authentication checks than average North American or UK consumers are.
Dutch ABN Amro customers generally need to use a bank-issued electronic card reader device as part of a payment authentication process, even when shopping online at home. Any process that eliminates the need to use this device would be a welcome improvement for these consumers.
Meanwhile, consumers in North America and the UK shop online relatively easily. Most retailers in the US and the UK implement little or no security checks at checkout, apart from asking for a three-digit security code.”
It is unclear if MasterCard will attempt to broaden the capabilities of this mobile app to compete with the capabilities being implemented by Apple and Alphabet which are already moving quickly to implement persistent identity by constantly monitoring and analyzing the user across all of the assets they can collect, such as face, voice, location, gait, and gestures. We will need to wait and see if the networks and financial institutions can really do a better job.
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group
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