Biometric authentication is changing the conversation around payments. Faster and more secure than traditional methods, biometrics provide consumers with a more convenient way to purchase. Facial recognition and fingerprint scanners have been available on smartphones and computers for several years. Now, similar technology is making its way to the point of sale.
In the fast-paced world of retail, innovation knows no bounds. Marketplace behemoth Amazon has led the charge in contactless, biometric adoption with its Amazon One palm recognition technology. Initially introduced in Amazon Go stores in Seattle in 2020, the company has since expanded its offering to Wholefoods stores, Amazon Go stores and sports stadiums around the U.S.
Amazon’s palm recognition solution uses advanced hardware to analyze unique characteristics, including vein patterns, lines and ridges in a user’s palm. By holding a hand over the sensor, Amazon One allows users to pay and verify their identity without carrying a physical payment card or government-issued ID.
Why Are Biometric Payments Becoming So Popular?
Amazon One solves several problems facing biometrics (and the payments industry as a whole), including:
Security: Many consumers hesitate to use biometric technology because they fear bad actors will steal or misuse their personal information. To keep consumers safe, Amazon stores biometric data in a cloud environment, separate from other Amazon customer data. The combination of off-site data storage, advanced encryption and regular auditing ensures the personal information collected by palm scanners is always secure.
In addition, palm scans don’t contain any visually identifiable information, unlike some biometric solutions (such as facial imaging). That means even if a hacker gains access to this data, they cannot identify the person’s identity just by looking at a picture.
Convenience: There’s nothing worse than getting to the end of a long line only to realize that you forgot your wallet at home. Biometric solutions like Amazon One allow consumers to make purchases and verify their identity with the wave of a hand. It allows consumers to interact with merchants quickly and effortlessly – even without physical cards or cash.
Health and Safety: Studies show that physical payment methods like cash, coins and cards are vectors for all things unsanitary, including harmful bacteria and viruses. Even PIN pads carry more germs than any other surface in retail environments like grocery stores.
Another benefit of Amazon’s palm scanning technology is that it doesn’t require physical contact to verify a user’s information, meaning shoppers won’t have to touch a fingerprint scanner, handle cash or give their card to someone they’ve never met.
Biometric payments are faster, safer and more convenient than traditional methods. But who uses them, and what does the future hold for biometrics?
Biometrics: A Growing Trend
Grand View Research estimates that the biometric market was valued at $34.2 billion in 2022 and will grow at a compound annual growth rate of 20.4% through 2030. As adoption continues to rise, payments providers, such as ISOs, banks and merchant acquirers, will have an opportunity to take advantage of this innovative technology.
In our annual Payments Innovation Pulse Report, we discovered that 69% of consumers are excited to try new payment technologies. Speed and convenience were two significant drivers of new technology adoption, with 84% of respondents saying that convenience was the number one reason they used a preferred payment method and nearly half (49%) adopting a payment method for its speed.
As NMI Chief Growth and Marketing Officer Peter Galvin said in a recent interview, “Right now, using this technology is very generational as younger consumers are more focused on using technology for their payments. Many Millennials and Gen Zers do not even carry cash and prefer digital wallets as opposed to physical payment cards. In fact, recent data found that 67% of Millennials already use digital wallets. These younger consumers have been the ones to really embrace biometric payments, and they will be the biggest drivers of adoption going forward.”
To learn more about Amazon One and the future of biometric payment authentication, read Peter Galvin’s full interview with Retail Customer Experience.
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