Investors Are Bullish On Broad Retail Biometric Payments

The following report is by David G.W. Birch for Forbes:

JPMorgan Chase is planning a broad rollout of biometric payments with U.S. retailers by early next year, enabling shoppers to make purchases by scanning their palms or faces. The bank’s executive director of biometrics and identity solutions, Prashant Sharma, said, “We would like every merchant to adopt this, but at the end of the day, it is going to be a merchant’s choice.” He is right, of course, but it is interesting to reflect on why merchants will choose to go down this route.

Convenience In Stores

When it comes to retail payments, the fact is that convenience always comes first. So, while merchants and financial institutions have to have security as table stakes, consumers have to have convenience. Biometrics, when implemented correctly of course, can deliver both. At retail point-of-sale, such systems are a win-win.

This is why I share that bullish take on the technology even in the U.S., which has in some cases been slow to adopt new payments technology. It adopted chip and PIN and then later contactless after all its peer countries and could do the same with biometric payment technology. Just one in four Americans are comfortable using a biometric hand scanner for payment. Meanwhile, 50% of Canadian and British consumers are open to adopting biometric payments and log-ins.

In fact, in the U.S., while consumer confidence in facial recognition biometrics for security purposes remains high, support for the use of the technology in retail settings has fallen significantly over the last couple of years. I think, as other observers do, that these consumer attitudes are a function of familiarity, which is why they will change quickly. The more exposed consumers are to biometrics at POS, the more comfortable they will be with this technology.

Americans are already beginning to experience a variety of new biometric payment options and I am sure that much wider adoption will accelerate. One place that Americans will become more familiar with the technology is sports and events where the technology is already being used to great effect. Amazon, for example, launched the Just Walk Out store in the Seahawks’ Lumen Field NFL stadium some time ago. The AI-based checkout allows fans to enter a concession stand, grab what they want, and walk directly back to their seats without going through a checkout process. Fans clearly like it, because the stadium saw double sales when compared to the previous store in the same location.

(Amazon is moving away from Just Walk Out for its retail stores and is focusing on its Amazon One palm recognition solution, having just launched an app which lets customers sign up for the service using their phone instead of visiting a store…