This story was delivered to BI Intelligence "Payments Briefing" subscribers. To learn more and subscribe, please click here.An Equifax-commissioned survey found a majority (56%) of respondents would like to use a biometric security method to log into to online banking over regular usernames and passwords, reports Finextra.The survey, conducted online in 2016, also found that UK consumers not only prefer fingerprint scanning, but are even beginning to warm up to less-common methods like iris scanning.Digital bankers have major pent up demand to use fingerprint scanning.Fingerprint scanning is the most preferred way to authenticate. One in three respondents said they would prefer to use fingerprint scanning, like Apple's TouchID technology, to log in to their financial accounts. Consumers preferring fingerprint scanning outnumbered those choosing regular user name name and passwords by a 14 percentage point margin, at 33% versus 19%.Despite its popularity, the majority of bank customers lack access to fingerprint scanning. Sixty-four percent of respondents with a bank account said that they were unable to access digital banking by scanning their fingerprint. Once factor behind the lack of availability is that many banks that lead in offering fingerprint scanning only support the feature on Apple iOS, finding the large number of devices to support on Android presents a greater development challenge.Tech providers lead banks in meeting customer demand. The three major technology provider mobile wallets, Android Pay, Apple Pay, and Samsung Pay, each already support fingerprint scanning to make purchases online and at the point-of-sale. Banks are increasingly finding themselves directly competing with mobile wallet providers, as more issuers release their own branded mobile wallets, like Wells Fargo Wallet, Chase Pay, or Citi Pay.Fingerprint logins to banking will soon become a need-to-have feature. Banks that roll out the fingerprint scanning feature today can lure customers with an in-demand capability most of their competitors lack. Those institutions also stand to increase digital banking frequency of use by removing the time and effort it takes users to log in. Recognizing the strong interest customers have in biometric logins, and seeking to position themselves as security-minded, it is likely that a large number of financial institutions will build out support for fingerprint scanning this year.Passwords and PINs are being rendered irrelevant thanks to rising digital fraud, growing concern about data privacy, and difficulty remembering an endless stream of letters and numbers. That's been leading both software and hardware firms to explore new methods of verifying user identity. One such method is biometrics'unique biological measurements that can be digitized and turned into a trackable record.These methods, which include fingerprint scanners, voice verification, or retina and vein scans, are steadily gaining popularity for unlocking smartphones or accessing sensitive apps ' BI Intelligence forecasts that by 2021, 99% of US smartphones will be biometrics-enabled. But they're also becoming increasingly popular as a way to verify payments, because they keep consumer data secure without inconveniencing consumers.But as these methods are implemented, firms face unique security challenges. Because of the way biological data is stored and encrypted, it's much harder for hackers to access and use. But if it is accessed, it's extremely valuable, since biological data can't be changed or replaced in the event of a breach. And though those risks could deter consumer, merchant, and vendor adoption, it appears as though most parties believe the benefits outweigh the risks and will likely implement biometrics-based authentication in their applications moving forward.Jaime Toplin, research associate for BI Intelligence, Business Insider's premium research service, has compiled a detailed report that sizes the market for biometrics-enabled smartphones in the U.S., described various types of biometrics authentication, evaluates their utility in the payments space, investigates the potential security risks and hurdles to adoption for both front- and back-end applications, and assesses the types that are most likely to see widespread application.Here are some key takeaways from the report:US smartphone makers are rapidly integrating biometrics-based features, such as fingerprint scanners, into their devices.BI Intelligence forecasts that 99% of installed smartphones in the US will be equipped with fingerprint scanners by 2021.The shift will happen much sooner for the installed base ofiPhones in the US' nearly all of which will be biometrics-enabled by 2018.Biometric technology is moving beyond fingerprints.Right now, biometric verification is largely concentrated on fingerprint-scanning technology on mobile phones. But the technology is expanding, and other verification methods, including facial recognition and iris scanning, are becoming more popular.Biometrics do pose their own security challenges.The unique nature of biometric verification, and the fact that the digitized record is stored locally in a secure portion of the phone, makes this data far more protected than traditional verification methods. But the risk to this type of data is also greater because unique, permanent biological identifiers are very valuable to hackers.In full, the report:Forecasts the number of US smartphones that will include fingerprint scanning technology through 2021 and assesses industry growthProvides data showing why biometrics relieve pain points associated with in-store and online purchasing without eliminating securityExplores different types of biometrics and evaluates differ net payments use casesEvaluates whether security risks and other challenges will hinder adoption of biometricsAssesses which type of biometrics will become most popular among consumers and developers moving forwardInterested in getting the full report' Here are twoways to access it:Subscribe to anAll-Accesspass to BI Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensureyou stay ahead of the curve and benefit personally and professionally. >> START A MEMBERSHIPPurchase & download the full report fromour research store. >> BUY THE REPORTThe choice is yours. But however you decide to acquire this report, you've given yourself a powerful advantage in your understanding of how biometrics are changing the payments industry.Join the conversation about this story
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