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When it comes to new payments technologies, it’s often difficult to know what consumers are thinking, and banks have a lot on their plates. When introducing new solutions and services, aligning a bank’s transformation strategy with the desires of consumers is an interesting chart to plot. Following our consumer research, we recently set out to understand how the opinions of banks compared - including understanding the importance placed on biometrics and why.
One thing that’s clear is that both banks and consumers have embraced contactless. As one of the biggest changes to payments in recent years, it’s now almost ubiquitous in several markets, with usage rising year-on-year.
With technology advancing however, biometric payment cards are set to be ‘the next big thing’. Offering the ability to move away from payment caps, while improving security and convenience, the draws for banks are clear. And many are now looking to deploy them sooner rather than later. However, when comparing banks’ priorities with our consumer research, there are both similarities and differences worth aligning.
It’s all about contactless, but…
The one thing that everyone can agree on is the importance of contactless payments. Both banks and consumers consider them to be the most important payment method. Whether this is through a card or a mobile, the days of mag stripe (and, dare I say Chip & PIN!) are numbered.
88% of the banks we spoke with agreed that contactless is the main payment priority in the coming years.
However, there is one striking difference between consumers and banks when it comes to contactless payments.
For the banks, the biggest issue with contactless is being able to lift the payment cap, but security is consumers’ main concern.
38% of consumers see security as a key barrier to using the technology, with 51% being worried or very worried about fraud.
This is not to say that banks are not worried about security and fraud – after all, it’s the banks that accept the liability for the new wave of contactless card fraud. Rather, the benefits and return of offering contactless outweigh the cost of fraud.
But, there is an opportunity for banks here.
Introducing biometric payments can help address consumers’ security concerns while empowering banks to finally lift the payment cap. The widespread proliferation of biometrics for smartphone authentication means consumers are comfortable with the technology. Plus, with added security, it can finally enable those high-value contactless payments, creating a win-win for both banks and consumers.
When it comes to using biometrics on contactless cards, 50% of consumers said they would even be willing to pay for the technology.
There are still concerns to be addressed, though, particularly around privacy and where the fingerprint data is stored. But this is largely a challenge of education, not of technology – all data stays on the card itself, meaning it never leaves the consumer.
What’s clear from our research, though, is that consumers consider biometric payment cards more secure than standard contactless payment cards.
So, what else are banks and consumers thinking when it comes to biometric payments?
Let’s talk about UX
User experience is a priority for both parties too. Banks and consumers recognize that biometric cards uniquely balance both convenience and security. But what’s more, both recognise the importance of having a smooth enrolment process that consumers can manage themselves.
Sure, perfecting the day-to-day payment experience is essential, but if the initial enrolment is difficult, clunky or confusing, the concept will fail before it has started.
79% of banks see biometric card self-enrolment being key, which is aligned with the consumers’ view.
Getting this right and making sure consumers are able to self-enrol will be crucial to driving adoption and promoting word-of-mouth advocacy.
Everyone is (almost) on the same level
When it comes to biometric payments, it seems that the banks have a good idea of what their customers are thinking. Ease of use, a move away from payment caps, and the ‘coolness’ factor are the major selling points for both consumers and banks, but educating consumers around security remains key.
With biometrics, banks can offer consumers both peace of mind from fraud, as well as an enjoyable and convenient UX. In short, the technology is now in place to enhance trust in contactless and help it reach its full potential.