Feeds

Fingerprint payments taking off despite security concerns

Let your fingers do the talking

High performance access to file storage

Consumers embarking on a shopping spree may be able to leave their wallets behind in the near future, despite some security and privacy experts' concerns. This week, Pay By Touch Solutions, a San Francisco-based firm whose system allows customers to pay at participating grocery stores with the press of a finger, announced that investors have pledged $130m to fund the company's expansion plans. And, rival BioPay has already enrolled more than two million people into its service for cashing payroll checks and paying at the supermarket checkout.

Paying by fingerprint is a hit with consumers, because people want convenience and faster check outs, said Shannon Reardon, director of marketing for Pay By Touch.

"The primary reason consumers sign up is for convenience," Reardon said. "They don't need a wallet or purse. When it become more ubiquitous, consumers won't have to carry cards around."

Moreover, the systems are popular with merchants, who stand to save a significant amount in processing fees if their customers pay using fingerprints linked to their bank accounts - up to 75 per cent over straight credit card fees, according to BioPay. The market for such point-of-sale equipment and services will jump to $440m - or 8.4 per cent of the market for biometrics - by 2010, up from $31m - or two per cent of the market - in 2005, according to research firm International Biometric Group.

Yet, the security of the systems largely remains a question mark. Security and privacy experts worry that pay-by-fingerprint schemes could lead to hard-to-combat identity fraud and greater threats to civil rights.

"What are their security practices and how much more extraordinary are they compared to a ChoicePoint, a LexisNexis, or a CardSystems?" said Pam Dixon, executive director of the World Privacy Forum. ChoicePoint, Reed Elsevier's LexisNexis, and CardSystems Solutions have all had high-profile incidents where consumers' financial and personal data has been leaked.

"Stealing a credit card number is one thing," she said. "But if your biometric is stolen and can be reconstituted, then that is a big problem."

Both Pay By Touch and BioPay pledged that their customers' security and privacy are of paramount importance.

Both companies require customers to physically enroll and link their fingerprint and customer ID number to one or more financial accounts. Social Security numbers are not used and accounts are only identified by the last few digits of the account number. The merchant never sees any of the information and nothing is left behind, said Donita Prakash, vice president of marketing for Herndon, Virginia-based BioPay.

"It is the least amount of information left behind about you for any of the possible ways of completing a transaction," Prakash said. "Nothing physical passes to the merchant that could be skimmed, and it's not leaving your body."

Moreover, neither system uses the actual fingerprint to identify the user, but creates a template of the fingerprint - generally a set of numbers measuring specific features of the print. The data format reduces transmission time, but also makes it impossible to reconstitute the original fingerprint, said Larry Hollowood, chief security officer for Pay By Touch.

"When we explain to our consumers that we are not taking the full fingerprint, but that we have 40 data points that can't be turned into a fingerprint, that increases the adoption rate," he said.

High performance access to file storage

More from The Register

next story
Obama allows NSA to exploit 0-days: report
If the spooks say they need it, they get it
Web data BLEEDOUT: Users to feel the pain as Heartbleed bug revealed
Vendors and ISPs have work to do updating firmware - if it's possible to fix this
OpenSSL Heartbleed: Bloody nose for open-source bleeding hearts
Bloke behind the cockup says not enough people are helping crucial crypto project
One year on: diplomatic fail as Chinese APT gangs get back to work
Mandiant says past 12 months shows Beijing won't call off its hackers
Call of Duty 'fragged using OpenSSL's Heartbleed exploit'
So it begins ... or maybe not, says one analyst
Heartbleed exploit, inoculation, both released
File under 'this is going to hurt you more than it hurts me'
Parent gabfest Mumsnet hit by SSL bug: My heart bleeds, grins hacker
Natter-board tells middle-class Britain to purée its passwords
Experian subsidiary faces MEGA-PROBE for 'selling consumer data to fraudster'
US attorneys general roll up sleeves, snap on gloves
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.