While this article and the accompanying press release hype some IoT opportunity associated with this acquisition, it is far more important that NuData’s product can add a sophisticated behavioral biometrics defense to eCommerce transactions. This new line of defense could be used to protect any eCommerce transaction which would greatly reduce eCommerce fraud:
“NuData’s NuDetect product identifies authentic users from potential fraudsters based on their online, mobile app and smartphone interactions, flagging those that represent the highest risk. The technology assesses, scores and learns from each online or mobile transaction to enable merchants and issuers to make near real-time authorization decisions.”
3D Secure V2 will enable the networks to require merchants to include more information about the user and the user’s device in authorization messages. Each network will likely have different requirements but based on this announcement it appears likely MasterCard will require behavioral biometrics be collected and added to the authorization message. If correct, this solution would stop a wide range of criminal activity in its tracks.
The effectiveness of this approach is documented in two Mercator reports, one highlighting how behavioral biometrics will move authentication into a cloud based service (Biometrics: A New Wrinkle Changes the Authentication Landscape) and one that offers a forecast for how quickly this shift will occur (Biometrics: A Market Forecast for Consumer Adoption). This announcement places MasterCard at the forefront of behavioral biometrics and suggests that the Mercator forecast is coming to fruition right on time. Equally interesting is the prospect that this positions MasterCard to offer a broader cloud-based authentication solution, one that could be utilized to provide authentication and access to every web site consumer’s access. Personally I can’t wait for my passwords to be replaced by biometrics, especially behavioral biometrics, that will reside inside my smartphone.
Overview by Tim Sloane, VP, Payments Innovation Advisory Service at Mercator Advisory Group
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