- Digital proliferation has made banks vulnerable to frauds
- Biometrics can help banks curb fraudulent activity
- Online banking can be made safer with fingerprint readers
- Iris scanners at ATMs and fingerprint technology can enhance security
While technology has streamlined banking operations and has made it more convenient, security remains a challenge for banks. In the digital era, financial institutions including banks are vulnerable to frauds. According to data from the RBI, Indian banks have reported a total loss of around ?70,000 crore due to frauds during the last three financial years, up to March 2018.
To keep fraudsters at bay, banks have resorted to various methods and one such technology which can help banks further augment their security is biometrics. Iris, fingerprint, facial recognition and palm vein are some of the most common biometric modalities.
Make online banking safer through fingerprint readers
According to a report titled “Encashing on Digital: Financial Services in 2020”, the number of online banking users in India is expected to reach 150 million by 2020. Banks can make online banking safe for such a huge number of customers through fingerprint readers.
These readers can help eliminate identity theft and ensure the safety of customers. By integrating fingerprint readers and matching them with a centralised database, banks can establish the identity of their customers. A fingerprint reader adds an extra layer of security to online banking.
Iris scanners at ATMs
ATMs are an important cog in the wheel of banking operations. With thousands swiping ATM cards to withdraw cash, check balance, and change PIN among others, security of ATMs assumes tremendous importance. By using card cloning machines, fraudsters steal critical data and use it to withdraw money from the card holder’s account. There have been many such cases in various parts of the country in the past.
However, iris scanners at ATMs can make ATM transactions more secure. Instead of just swiping a card, entering PIN, and making a transaction, an iris scanner would complete the process only when the biometrically-loaded data of the user matches with the bank’s database.
Mobile banking integrated with fingerprint technology
Due to a rise in the number of smartphones, mobile banking has gained much traction. One can transfer funds, pay bills, request a new chequebook, etc., through it. By integrating fingerprint technology in mobile banking, banks can step up their security whereby only on successful validation of biometrics data, users can conduct various mobile banking operations.
In fact, most phones are compatible with fingerprint technology allowing customers to proceed with mobile banking on successful validation.
Biometric identification for employees
There can be cases of a disputed transaction. In such an event, a lawsuit from a customer or employee can result in high litigation expenses for the bank, affecting its operational revenues. However, biometric identification of employees can eliminate chances of a doubtful transaction and also bring down cost in an event of a litigation.
Data protection is extremely important for banks. A breach can not only result in a financial loss but also affect credibility. With biometrics providing data security by capturing an individual’s characteristics that are almost impossible to duplicate, the technology will play a critical role to improve the security of banking operations and enhance customer experience in the coming days.