Banking & Finance

Biometric authentication — such as facial recognition and fingerprint technology — is transforming the banking experience. Biometrics deliver precise identity verification to enhance security, reduce fraud, streamline operations, and ensure customers have a safe, seamless interaction at every touchpoint.

MIAXIS Fingerprint readers and fingerprint modules has been widely deployed in this industry.

Following are some of the main use cases for your understanding how Biometric works in this filed.

1. Customer Onboarding

The first step in the customer onboarding process involves identity verification. This is how banks ensure that they are dealing with a legitimate person from the start, allowing them to filter out potential criminals early on. This is where biometrics come in to help banks build a simple and secure way for customers to open a bank account. 

Additionally, this is a crucial step because banks are obligated to adhere to KYC/AML, which requires ID verification. Traditionally, this process took place in person at a physical branch. Today, as part of customer onboarding, users are asked to scan a trusted identity document, like a passport or a ID card, and then complete a brief biometric facial scan. This ID step enables banks to confirm the identity of each new customer without the need for an in-person meeting.

The onboarding stage presents the highest level of risk because, initially, there is limited information available about the user or their risk profile. Therefore, it’s crucial to begin with the highest level of identity assurance to defend against threats like deepfake technology or synthetic identity fraud. 

2. Customer Re-Authentication

Biometrics, particularly facial recognition technology, enable banks to implement a swift and secure re-authentication process that eliminates the need for users to rely on traditional passwords when logging into their accounts. That’s crucial because legitimate accounts can still become compromised later in their customer cycle. Biometric face re-authentication consistently verifies that the individual attempting to access the account is indeed the same person who initially created the account.

Re-authenticating the customer isn’t always an option for banks. Financial institutions do this in cases when the customer poses a higher risk of money laundering, for example. Other cases when banks re-authenticate their customers are when they request additional credit, initiate a password reset, change their personal information, request a large transfer, or add a new device. This approach allows banks to strike a balance between convenience and security for their customers.

3. Mobile Banking

Mobile banking is experiencing rapid global growth, where biometrics play a vital part. Using a fingerprint or facial recognition for authentication, we can make payments anywhere, anytime. Integrating biometric technology with existing fraud prevention systems means that banks can provide the highest level of security available. At the same time, banks can present greater confidence in mobile banking among their customers, especially if they utilize secure digital banking software.

And with the ongoing battle against criminals online, banks need to find a way to safeguard their customers. For example, a common tactic that hackers use is credential stuffing. It happens when criminals try to steal usernames and passwords on numerous online services. This scheme is often successful because users find it hard to create secure passwords for every online account they have. Biometrics solve this problem. 

4. Branch Banking

Utilizing fingerprint, facial, or iris recognition within financial service institution branches ensures rapid and reliable biometric authentication, even during peak activity periods. For example, banks use biometrics to grant access to safe deposit boxes, ensuring that only authorized individuals can access their contents. 

Similarly, when customers visit these branches, they can undergo authentication at the service counter by matching their fingerprint, facial features, or iris scan with their pre-registered biometric data stored in the bank’s database. Biometrics can also help identify regular customers as they enter the branch, enabling staff to offer personalized assistance and services based on their previous interactions and preferences.

5. ATMs

Biometrics in ATMs have become popular in many developed countries. Consequently, some banks integrated fingerprint recognition technology into their ATMs. Customers can link their fingerprints to their bank account, and when they visit the ATM, they simply need to place their finger on a biometric sensor. 

The ATM scans and matches their fingerprint with the stored data to verify their identity. Once verified, customers can proceed with their transactions, such as cash withdrawals or balance inquiries, without needing a physical card or PIN. That’s why this identity proofing method provides both convenience and accuracy while requiring minimal space.