2016 was – unfortunately – a banner year for data breaches. The one thing all of these attacks had in common? Weak or compromised passwords. This reality should be putting all companies on edge, but some industries – like financial services – are particularly worried, given the extreme financial risk to themselves and their customers, should an attack occur. In fact, large financial institutions budget upwards of $500 million annually for cybersecurity. The obvious – although difficult – solution: Do away with passwords.
And this is not just because they’re a security risk: They are also incredibly expensive for companies. On average, the cost of resetting employee passwords is around $180,000 annually per 1,000 employees (and that’s not even to mention the number of customer service calls for bank customers who have forgotten their pins). That number is massive and unnecessary.
From my time at HSBC and JPMorgan Chase, I’ve seen all of this first-hand, and I’m convinced that biometric authentication is the change we need. By asking employees and customers to use fingerprints, facial recognition or other unique biometric markers to authenticate, institutions can be certain that the person completing the transaction is who they say they are. By every measure, the benefits of using biometric banking in the financial industry – from mobile banking to high-value trading to access to physical sites like vaults – outweigh those of passwords:
- Reducing both the cost and risk of financial fraud
- Convenience for customers – not only because they no longer need to remember passwords and pins, but because biometric banking is faster and easier
- A cost-effective solution for intuitions by reducing costs associated with password resets
We know this works: One of our customers, bunq – the world’s first mobile-only bank – has been using biometrics to great success for both the company and their customers.