Even before the coronavirus pandemic, the use of cash was on the decline in every region around the world. This trend has only intensified with the pandemic, which has accelerated the global shift away from cash with many moving towards digital payment solutions to avoid the spread of the virus via PIN pads. The use of cash also declined following consumer concerns around the virus staying on bank notes for around 48 hours, and ATMs potentially being touched by hundreds of hands, increasing the risk of contamination of the virus.
Touch-free authentication offers a wide range of benefits as it allows consumers to make a transaction without having to touch a shared PoS to tap in a PIN number, sign for their purchase, or hand over cash. It is common when tapping a contactless card or using a mobile payment app and is an increasingly vital step in the process of making the payments industry safe in the world of coronavirus. Yet, there is a significant segment of society that still rely on cash who are unable to embrace touch-free payment authentication.
As we move more towards a more digital-focused society, Government bodies are increasingly worried about the effects on vulnerable members of society. In particular, the elderly, those who remain un-banked, or those without a smartphone are still reliant on cash and could be left excluded in a digital-first payment ecosystem. In a post-Covid world, these same groups are those who could be most exposed to further viruses from cash circulation.
So, with touch-free payments important to improving hygiene, there is an important question to consider for those unable to access contactless payments: could digital exclusion be a barrier to a Covid-free society?
Bridging the digital exclusion divide
Those who are digitally-excluded have limited or no access to digital tech that can make life more convenient, such as a smartphone or payment apps. According to the ONS nine percent of UK adults, or almost 5 million people, don’t have access to the internet, while in the USA, FCC data suggests around 42 million Americans lack broadband internet. As a result, online banking would be inaccessible to many. In the UK, the Government-commissioned Access to Cash review found that 17 percent of the population – over 8 million adults – would struggle to cope in a cashless society.
Exclusion from the digital world can lead to lower skills and confidence, but it can also lead to social exclusion and a wider impact on economic problems. As payment technology continues to advance, the use of basic IT devices could become essential to access goods and services. While touch-free digital payments offer many benefits, not everyone is ready to embrace a fully digital society just yet. But in our new normal, we must also consider the need to remove the concerns around transmission of the virus on cash.
Therefore, it is important to be more innovative in our approach to payments and ensure that Governments and banks work together to develop new digital payment technology in a more inclusive way, to bridge the digital exclusion gap.
Failure to do so will see those without access to digital services and payment options locked out from everyday services that so many of us take for granted and forced to continue using cash. Meanwhile more digitally-included members of society are able to avoid touching paper notes and coins or ATMs amid the threat of the virus. With more and more banking services moving online the need for simple and secure access to these digital services is more important than ever before.
Biometric technology - the solution to digital inclusion
In The Access to Cash review, the commission highlights biometrics in digital payments as an innovative technology that will make payments even easier in the future, which will support the pace of change towards a cashless society.
Biometrics are likely to be key to revolutionizing digital inclusion in the coming years. As people get used to using fingerprints and faces to identify themselves, biometrics will become a more familiar and accepted touch-free way to validate transactions. Now, fingerprint biometric sensors can be incorporated into smart payment cards providing a speedier, personal and more secure means for consumers to authenticate payments.
During a transaction, a consumer only needs to touch their finger to the sensor on their own payment card, and then hold it over the contactless Point of Sale. This will allow them to authenticate a payment of any amount, without a payment limit. By extending biometrics to payment cards, authentication will no longer rely on what you know, or what you can remember, but who you are. This is valuable for those who struggle with PINs as well as in countries with lower literacy levels or less reliable identification systems.
The use of fingerprint biometrics in smart cards are also an affordable way to ensure touch-free authentication in the payment process while effectively banishing the concerns people currently have about the implications of devices being lost or stolen. For those that don’t have access to a smartphone, they will still be able to bank and pay for goods securely and in a touch-free way without a large upfront cost.
The benefits of touch-free authentication
Whilst tackling digital exclusion remains complicated, the pandemic acts as a catalyst to accelerate digital inclusion within wider society. Advancements in technology such as biometric fingerprint technology are leading the way to a more inclusive payment method. By placing an emphasis on usability, the benefits of touch-free authentication can be made available to all.
As the pandemic continues and we continue the journey towards a cashless society, government bodies must work closely with payment method providers and banks to avoid alienating those who depend on cash as their primary payment method and ensure that there are touch-free payment methods for all. Biometric payment cards will not only help to limit a potential second wave, but also help to protect vulnerable citizens from the spread of future viruses.
Vince Graziani, CEO, IDEX Biometrics ASA