Iris-scanners and biometric fingertip readers sound like something out of a spy-thriller, but these devices have already been adopted by financial institutions in international markets. More than 15 million citizens use the technology in Japan alone. Banks in Mexico, South America, Africa, and the Middle East are also moving toward the new technology due to its popularity with rural consumers who aren’t accustomed to carrying bank cards (but apparently don't mind having a machine scan their fingerprints). In the current market, Western banks and financial institutions are already set to integrate biometric technology with mass market banking.
Banks Adopt Biometric Technology to Combat Fraud
Consumer liability for fraudulent charges and the cost of implementing biometric technology remain the top reasons why U.S. banks haven't yet adopted the ATM biometrics. In Japan, legislation requiring banks to pay for fraudulent charges led to more than 80,000 biometric ATMs being installed since 2006. In the United States, consumer reluctance and privacy concerns have been cited among the main drawbacks, but a recent survey shows consumers in all age groups overwhelmingly vote for biometric scanning as the preferred authentication method for ATM withdrawals.
A Way to Combat Identity Theft
According to industry numbers from Javelin Strategy & Research, one tenth of fraud cases in 2009 involved unauthorized ATM withdrawals. ATM skimming devices that capture card data and PINs are not the only security threat; at the annual Black Hat information security conference, noted hacker and security specialist Barnaby Jack hacked into the ATM’s rootkit, gathered card data, and emptied the ATM’s cash reserve. Fortunately, the security guru also revealed safeguards that could easily be implemented to prevent the same type of attack.
ATMs of the Future
Today’s biometric scanners go far beyond basic fingerprint recognition. According to security experts, fingerprints can easily be lifted and replicated. In Poland and Japan, consumers are already using Hitachi's infrared scanners that capture the unique pattern of capillaries in the finger and hand. The most secure biometric technology uses a device designed to perform an iris scan based on more than 2,000 unique measurement points. According to developers, people and pets all over the world will be connected to a system that uses iris scan identification within the next decade.