With technological advances so prevalent these days — whether through smartphones and now even when sweating it out at the gym — advocates of biometric banking have continued to encourage national financial institutions to partake in the latest technology to protect their customers. However, banks have not demonstrated as much enthusiasm for similar fingerprint identification methods that 24-Hour Fitness members use for a number of reasons.
The reality is that many Americans still are wary about relinquishing their biometric information. Despite reassurances from developers like MorphoTrak, consumers are still concerned about the possibility of even the most complex algorithms can be cracked.
Inaccuracies in Past Trials:
Using biometrics in the banking industry is by no means anything new. Banks that participated in early stages of fingerprint identification found the technology to be faulty, displaying false positives and false negative readings of fingerprints.
No Incentive to Transition to Biometrics:
In Japan, banks transitioned to biometric ATMs that use “finger vein” technology (an infrared scanner detects the unique pattern of customers’ micro veins and matches it to a profile), due to a government regulation enacted in 2006 that made financial institutions responsible for absorbing fraudulent ATM transactions. To avoid the loss, Japanese banks installed 80,000 biometric ATMs in the country.
U.S. bank losses due to fraud, however, don’t exceed the cost to implement such a big-scale transition to biometric protection, which can cost banks thousands of dollars to install just one unit.
When discussing the advancements in fraud prevention, executive vice president of the Federal Reserve Bank of Atlanta expressed that the United States is “falling behind the rest of the world in fraud protection, and I’m afraid American consumers are getting the short end of the stick.”
As fingerprint identification matures in its sophistication, banks may someday recognize the benefits and protective attributes that biometric security has to offer, until then customers must still tote their personal IDs or drivers licenses to verify their identities.