The Impact of Biometrics on the Banking Sector
Updated On : April 2022
Biometrics is an automated method of identifying customers with the help of biological characteristics and traits like iris, voice recognition, and fingerprints. This characteristic is unique for every individual and not easy to forge into. This technology is rising as an advanced layer to many personal and enterprise security systems.
Banks across the world are using biometrics in their core banking systems to authenticate customer information.
Different ways to use biometrics in banks and financial institutions:
- Branch banking
The financial institutions use fingerprints and finger vein biometrics in banking for customer identification in their bank branches as these two biometric authentication methods help to deliver fast results which help the busiest branches of the banks. When the customer visits the branch, the details are matched at the counter with the help of a biometric scanner with the existing bank’s database, and post successful authentication customers can move ahead further with their banking transactions
Customer authentication in ATMs can be done by facial recognition, finger veins patterns, fingerprints, and iris recognition. This can be easily authenticated. The advantage here is flexibility, compactness, and accuracy.
- Internet and Mobile banking
Banks are using multi-factor authentication systems in the internet and mobile banking, this helps the banks to protect customer identities from cybercrimes and illegal access to sensitive information.
The impact of using biometrics in banking:
- Fast and secured customer service
The financial sector has to protect the customer data, biometric authentication helps in providing a secure and flexible solution to verify the customer details.
- Protection of banking information
Biometrics technology is one of the strongest methods of authentication which helps banks to protect their information.
- Accurate and fast branch banking
Biometric technology provides fast and accurate identification for the banking industry. The customer details can be easily authenticated in a span of seconds.
- Protection against insider fraud
Biometric identification of employees performing transactions in the backend is one of the crucial steps in ensuring identity protection and reducing fraud. Biometrics will help banks in preventing insider fraud by establishing secure employee authentication, accountability, and concrete audit trails of each transaction.
- Secured internet banking
Biometric authentication helps banks to protect customer identities and customer transaction details while using internet banking.
Banks and Financial institutions are adopting innovative security technologies that are compliant with regulatory guidelines, secure, are cost-effective, and help in improving customer satisfaction. Biometric technology integrated with an existing security system is helping in empowering banks in deploying a high level of security.
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