In January 2017 Mercator published “Biometrics: A Market Forecast for Consumer Adoption” that predicted the adoption of biometrics for payments and developed a methodology for testing that forecast over time. Not discussed in this article is how possession of the smartphone itself is another important identity factor, so the two factor authentication consists of the phone and the biometric:
“As mobile devices have become an essential part of our lives, Apple and Google have slowly normalized identity verification and made it habitual. Over the course of a few years, starting with PIN codes to now biometric verification through fingerprint and facial recognition, the two major mobile OS providers have effectively removed the “creepiness factor” of biometrics and transformed it to an everyday routinized activity; just think of how many times a day you access your smartphone! Over the years as more and more activity shifted digitally to one’s device and its apps, trust built up between the mobile OS and the consumer and identity verification through a smartphone became universally accepted. As a natural extension, mobile payments through one’s device are now easily executed after an initial set up process connecting payment methods to the handset, with identities quickly and easily verified at the point of sale (i.e. “POS”) each time a purchase is made.
From the merchant side of the payment system, Amazon has built up consumer trust by following its customer obsession leadership principle in all that it does. As a result, it has dominated online shopping and with Whole Foods and its Amazon Go stores, is starting to present its frictionless shopping experience online into the offline environment. In fact, Amazon Go stores have gone so far as completely removing the payment experience in store. One simply logs into Amazon and scans the generated QR code upon entry, grab desired items and walk out of the store. Charges are sent to your account for the items you’ve “purchased” shortly after the store visit. Additionally, Amazon has recently announced that it is experimenting with palm print reading technology – effectively using your unique handprint to verify your identity. Amazon intends to license this technology to other merchants – which if successful, can create a network of “hand identity” verification shops around the world.”
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group