Towards the end of 2016, Financial Fraud Action UK released its official figures around financial fraud which showed a 53% increase compared with 2015.
Its research revealed that an incident took place every 15 seconds between January and June 2016. The South African Banking Risk Information Centre (Sabric) found that in SA, Gauteng and the Western Cape were the most affected provinces for card fraud, with a 13% increase in credit card fraud and a 9% in card not present fraud.
The organisation added to its statistics some clear warnings to consumers around ATM usage and card verification. For the banks, these numbers are red flags peppering a landscape of risk. So how can financial institutions address these challenges comprehensively without impacting on client service delivery and efficacy?
No added hassle
Greg Sarrail, VP of HID Global, says customers don't want to sit in longer queues or carry even more identification paperwork. "There is already a heavy weight placed on both bank and customer when it comes to identity verification. In many banking services markets, biometrics are successfully authenticating users at ATMs while improving the user experience. These systems not only make life easier for the user, but they provide banks with assurances around transaction security and trust. Biometrics is the only authentication method that links a person's unique biological credentials to their banking details. It is only their finger that can unlock their data."
Although this might appear to add more complexity to an already confusing process, Sarrail says once an individual has had their biometric details added to a system, they never have to undergo the verification process again. The banks can use these details to streamline the authentication process while making it more robust and reliable.
"ATMs use a card and a PIN to authenticate a user and have done so for many years - it is a technology that's in dire need of a security revolution," he says. "Without biometrics, the digital identity can be easily hacked, stolen or manipulated. With biometrics, the ATM becomes a fortress that only the correct user can access."
Liveness detection
He adds that fingerprint sensors used today are incredibly powerful and can distinguish between legitimate and counterfeit biometric characteristics, removing any hassles that dirty fingers or sensors might cause.
With biometrics, the ATM becomes a fortress.
Greg Sarrail, HID Global
"It's a feature called 'liveness detection' where the sensor reads below the surface layer of the skin, skipping any grime or oil on the upper layer of the finger that could impact on the reading. Leading biometrics sensors are capable of determining an identity through dust, oil, dirt and powder, among many other substances, and they can discriminate between live fingerprints and fakes. With this functionality, access is easy and accurate and financial institutions can assuage their concerns around user privacy and identity fraud."
So can biometric technology support mobile payments and applications? Sarrail says yes.
"The future is definitively mobile and, as fintech disruptors and financial giants look to the mobile device for innovative payment and transaction solutions, biometrics add a much-needed layer of security."
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