Friday, 7 June 2013

The Future of Payments Part Three: Pointing Towards the Future

Each week I give my 12 year old daughter her school dinner-money and she quips "I’m going to load-up my finger". Her school is one of many now using the technology which means when a student pays for a meal, they place their finger on a scanner that brings up their name, class and the balance of their account.

This makes me wonder whether the same technology will ever be used in the high street, in supermarkets or even online. It’s a concept that has been trialled before, and some trials continue to this day, but largely this technology has slipped away from mainstream attention as the payment industry has focused more recently on mobile, near field communication (NFC) or other contactless payment methods.

Past challenges with biometric systems have been concerns regarding security and privacy. In fact most systems don’t use the actual fingerprint to identify the user, but create a template of the fingerprint - a set of numbers measuring specific features of the print - making it impossible to reconstitute the original fingerprint. Nevertheless concerns do exist about the interoperability of fingerprint systems and the severity of the consequences of the loss of one’s fingerprint template.  

Interestingly there are rumours that Apple, having acquired a company specialising in this technology last year, could be about to incorporate fingerprint sensors into one of its next iPhone releases. The vision and forward-thinking of one or two large organisations or retailers is all it will take for biometric systems to leap back into the mainstream.

When it comes to making payments (of any kind, including those relating to debt), fingerprint systems could eradicate the need for identification and verification steps, or having to remember numerous log-in details, making both physical and even online transactions and payments even easier. It could be the ultimate ‘single sign-on’ and could create some interesting debate around the passing of personal data between organisations, for example in the debt industry, between creditor and debt collection agency.

I believe Plato said "nothing is more certain than change" and this is certainly true in the world of payments. Combined with the growing use of online wallets such as PayPal, all payment-taking organisations, and of course that includes the debt industry, will need to constantly rethink the methods and channels through which they take payments.

And I fully expect in the next few years my daughter will turn to me and say witheringly: "Dad, did you really carry around a wallet stuffed with payment and loyalty cards? You should have used one of these instead!" wagging her ‘powered’ finger at me.

By Carlos Osorio - Director, e-collections and payment services,
TDX Group

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