COVID-19 IMPACT SURVEY MAY 2020
The global market for Biometrics for Banking and Financial Services is projected to reach US$10.8 billion by 2025, driven by rising venture capital investments in anti-fraud FinTech solutions against the backdrop of the continuous rise in financial transactions and a parallel increase in fraud and security breaches. The advent of the internet and digital banking has significantly pushed up the burden of banking fraud. Digital identity theft and fraud is the single most risk factor in banking and finance related frauds. Responding to banking fraud in the modern digital world needs more powerful, foolproof technologies. Biometrics is a powerful weapon to combat the growing threat of financial frauds. The technology is therefore hogging the limelight supported by benefits such as easy fool-proof authentication based on unique physical characters that are hard to replicate or duplicate i. e. voice recognition, iris scanning, fingerprint, and face recognition; elimination of the need to remember passwords and manage one-time-passwords (OTPs); enhanced security immune to cyber hacking strategies; unrivalled convenience; significantly reduced risk of identity theft; higher quality user experience; minimal to zero user interface; time saving and reduction in back office authentication workloads, among others. Behavioral biometrics is being explored for preventing "new account fraud". Fingerprint, finger vein, palm vein, iris, and facial recognition are popular biometric ways for banks to identify & authenticate customers. Biometrics is increasingly being implemented in ATMs, internet banking, mobile banking and branch banking.
Other major trends in the market influencing growth include rise of e-commerce, m-commerce, development of mobile and online payment platforms and the resulting increase in virtual payments; rise of cashless societies supported by increasing smart phone, and mobile internet penetration rates; increasingly stringent regulations for payments authentication; rise of behavioral biometrics and improvements in smart fraud detection especially in the banking sector; and growing popularity of the innovative concept of "selfie" for secure authentication. The launch of smart phones with fingerprint sensors and scanners, retina scanning, and facial identification will also help boost growth in the market. Banks presently are widely deploying vein recognition biometrics, a technology providing efficient and accurate way of providing protection from identity and data theft. Financial institutions in South Africa, Brazil, Argentina, China, India, and Mexico are adopting vein recognition biometrics. Among the vein recognition biometrics technology, finger vein recognition accounts for the largest share, while palm vein recognition is forecast to witness the fastest growth. Meanwhile, eye vein recognition also holds a small share of the market. Regionally, East Asia and Europe are expected to witness increased adoption of the technology. Business customers authorize transactions by merely placing a finger in a small desktop scanner rather than entering PINs and passwords. The technology uses the unique vein patterns on customer's fingers for authenticating and the vein patterns remain mostly unchanged through life. Asia-Pacific including China is a major market led by factors such as developing banking and financial services industry as a result of concerted government financial inclusion policies aimed at reducing underserved and unbanked communities; vulnerable internet and information security infrastructure and a high risk of cybercrime and increased focus on cyber training, education, awareness and the resulting acceptance of new fraud prevention technologies like biometrics.