Biometric cards can play a vital role in the proper dispensation of benefits in India going forward, K Srinivasan, Chief Operating Officer, FSS PayTech told ET while speaking about the company's collaboration with Zwipe to bring next generation contactless payment cards to issuers globally.
Srinivasan said that while FSS has not directly engaged with the government, he said the use case for biometrics, especially in a country like India where there is a lot of adoption of biometrics in any case, owing to Aadhaar and Aadhaar-enabled payments makes it a perfect place to use biometric cards for the dispensation of benefits.
"Direct benefit transfer in many countries happens through a card," he explained. " How do you make sure that the right person is coming and taking the benefit? These biometric cards can play a very good role for this, particularly for customers like where we have in Africa, where they use an issuing system, they use cards to dispense pension, for example."
For instance, he said that if one was to transfer money for Covid relief, the biometric card can be programmed to ensure that the card will only function when used by the right person and at the right place, say a ration store rather than a store that sells alcohol. Thus, making it possible to make sure the money disbursed is used for the right purpose and the dispensation mechanism can be centrally loaded.
Srinivasan said that the pandemic has accelerated the use of contactless payments even further as consumers demand a safe, contact-free transacting environment. However, the lack of cardholder authentication with contactless cards translates into usage being restricted to relatively small and medium value payments, hampering the ability to deliver a fully contact free experience for all payment values. The response to this is the biometric payment card that fully enables contact-free transactions while boosting confidence and security for consumers, retailers and issuers.
"Biometric payment cards will bring strong differentiation and value uplift to our card issuance and management offerings. Our collaboration with Zwipe will help our issuer clients to deliver a completely touchless and PIN-free check out experience, better in-store payments hygiene and much stronger cardholder security. Zwipe Pay ONE is recognized as the most advanced (Gen3) biometric payment technology and complements FSS's innovative card portfolio. It will be made available to our clients for piloting and deployment from H2 2021," Srinivasan said.
FSS is a provider of card issuance products globally and its card portfolio consists of 800 plus million payment cards for Tier One banks and payment processors. The organizations will be working together closely and will combine FSS's Unified Issuance Platform and Zwipe Pay One biometric card capabilities, supported by Zwipe's growing global network of card manufacturing partners.
As part of this collaboration, FSS will offer Zwipe Pay ONE biometric payment cards globally. The initial focus will be in those markets where contactless is bringing considerable benefits in the area of financial inclusion as seen in Canada, India and a number of countries within Europe, Middle East (GCC countries) and Africa. Both partners will start engaging with issuers from Q2 2021 and aim for starting pilots from H2 2021, FSS said in a statement.
When it comes to India, Srinivasan said that these biometric cards can play a very vital role, but it is the adoption that is to be seen. For this adoption to happen, a strong ecosystem is the need of the hour. Srinivasan said that there is an ecosystem movement that's happening around biometrics currently.
"For example, Zwipe itself is a FinTech company that focuses on security, focuses on authentication mechanisms which is a very narrow, but deep field that is important when it comes to establishing credible authentication. They are trying to educate all the card manufacturers, they're trying to work with many processes, they're trying to talk about what they can carry out as proof of concept. So, there is a lot of momentum happening around those. The moment that shifts, there will be some sort of regulation, or some sort of adoption driven by the regulators."
He went on to add that in India, hesitation to use biometrics was not a cause for concern as the country has adopted Aadhaar and Aadhaar-enabled payments.
"There are more and more biometric cards that are likely to be issued in 2021in India," Srinivasan said. "And India itself is a country where there's been an extensive use of biometrics, for example, Aadhaar itself is a big part of biometrics. So, it's not about hesitation to use biometric because Aadhaar-enabled payment is itself a classic example of adoption of biometrics."
Research estimates 2.5 million biometric cards to be issued in 2021 and that according to industry reports, biometric payment cards with built-in fingerprint sensors could add $5 billion to revenue in the global banking sector by 2026.
Blog Source : The Economic Times