I recently received an email, from an investor, asking for color on American Express’s potential interest in mobile payments. The shareholder asked how that might affect biometrics and BIO-key. I felt my response might be an interesting blog post.
It’s well known that American Express is involved with Contactless Smartcard technology and has been for years. In fact, all major payment network operators, especially MasterCard, have veered and even promoted their respective technology trajectories toward Contactless Smartcards and mobility.
Contactless Smartcard technology is a defined technology class, complete with its own set of Standards. The International Organization for Standardization (ISO) administrates several Technical Advisory Groups (TAGs) that are comprised of industry stakeholders who do nothing but develop the Contactless Smartcard Standards (ISO 14443-a/b) for introduction into the mainstream.
PayPass, PayWave, “Chip and Pin”, your Passport and likely, other credentials that interact wirelessly, utilize ISO14443a/b. Further, appreciate that ISO14443a/b has migrated into the Mobile/Cellular environment, but has changed nomenclature, as “Near Field Communication” (NFC).
If you were to dig around out there…conduct a Google search….for Near Field Communication or “NFC”, you will find enough not-so-light reading to keep you busy for months. Today, there are 127 smartphones globally with NFC as a feature. There are 35 additional smartphones, including the most recent Samsung Galaxy-4, that are launching with NFC, but not released for sale yet. The Apple iPhone 5s is rumored to include NFC, alongside fingerprint biometrics. And why not?? All major payment networks…Visa/MasterCard/American Express and Discover are pushing the use of Contactless/NFC in the cash register Point-of-Sale customers’ infrastructure.
So, to conclude, yes, Amex is deep in Mobile Payments, a subsection of Mobile Credentialing (to include passports, drivers licenses, Corp/School ID, Gov’t Service ID, Payments, etc.), as are most payment vendors.
Yet, how does this impact biometrics and potentially BIO-key? Consider what NFC does to understand the role for biometrics. NFC is the transmission medium for valuable credentialing data. It’s designed specifically for this.
As we start to store valuable data, like credit card data, on the phones and as we start to allow high value transactions on the phones, the fraud-risk profile of the device and its use-case changes dramatically. The only way to mitigate that risk is to lock the user to the device at the time of the transaction.
There are many ways to lock the user to the device and transaction, but biometrics are the only method that doesn’t involve some second technological method, effectively a second credential to authenticate the user. Biometrics are the only way to intrinsically know the user was, in fact, the correct person executing the transaction.
In my opinion, this is could be part of why Apple bought AuthenTec, as well as part of why InterDigital, IBM, CA Technologies and other companies are working with us.
Thus, the emergence of NFC into the mainstream, along with digital wallets and secure-elements within the phone, is the catalyst to drive broad-based biometric adoption.