SAN MATEO, Calif. — With Apple and Samsung promoting fingerprint-scanning technologies for smart phones, this biometric authentication solution is starting to become more mainstream for U.S. consumers.
And while some credit unions have rolled out employee biometric authentication systems for employees, the big question remains: When will a CU adopt fingerprint scanning as a member-facing technology?
"There is certainly lots of interest in biometrics," said Daniel Latimore, senior vice president of the Banking Group at Celent. "There are institutions looking to determine if fingerprint technologies will be secure enough for them."
The ability for a member to log into an account with one press of a finger, opposed to cumbersome user names and passwords, has app developers busy, noted Latimore. However, San Mateo Credit Union, which currently uses biometrics with its employees, is not anticipating member adoption anytime soon.
"We are only concerned with staff at this point. Using remote access brings its own set of challenges," said San Mateo's Vice President of Information Technology Pete Kneisler. "I do not see using the technology anytime soon for the members. It will start with mobile banking first and for now we have seen no demand. As a second factor, there are just too many without this feature."
Kneisler explained that $600 million San Mateo CU started using employee-facing biometrics via third-party provider, DigitalPersona, four years ago. To date, all of the credit union's 175 employees use the technology.
"We were just looking for time savings from the reset process plus an additional security layer on everyone," recalled Kneisler. "The primary issue involved folk's poor passwords because there were so many they made them easy and memorable. The new model is simple and secure."
Touch and Go
Elaine Bliss, DigitalPersona's VP of product management and marketing said that the company serves in excess of 100 financial institutions, a majority of which are credit unions. The process entails implementing DigitalPersona Pro Enterprise software and U.are.U Fingerprint Readers, which secure access to applications and member information.
While ATM finger-scanning technologies have been used internationally since the mid-1990s, Bliss said in recent years a technology shift is reshaping approaches to the adoption and application of biometrics.
For example, Digital Persona has two Mexican banking clients: Banco Azteca and Coppel. The former's 25 million customers use fingerprint biometrics to access their accounts and authenticate transactions.
"Outside of the U.S., it is a very strong trend that banks and the equivalent of credit unions are using fingerprint biometric for customer client authentication because often times those people do have a very clear means of proving their identity such as driver's licenses or passports," said Bliss.
"In the U.S., we are seeing it more as an increase in customer service and a different differentiation for credit unions to offer on both the teller and member side," noted Bliss adding that certain clients are realizing success using member-facing in-branch scanners. "This increases response time and in the end increases member satisfaction because it is a visible security."
And while she could not offer statistics on finger misreads or fail rates, she said it's recommended that users scan multiple fingers into the data base.
"We also recommend explaining this technology to employees and the member base before going live—you should do a pilot to get everyone comfortable with the process and make sure everything is working," said Bliss. "What is stored is a template not a finger print image. The concerns are usually not from c-level executives, but from employees because they don't understand how the technology works."
Workers' Credit Union (WCU) has also adopted DigitalPersona's biometric solution. The credit union's 240 employees use the technology to confirm positive identity when accessing online applications and websites, noted Dave Thibodeau, vice president of information technology at Workers' Credit Union.
Since rolling out the solution, Thibodeau explained that Worker's CU employees have recovered "two to three percent of their time that used to be lost to remembering and keying in passwords." And since the IT help desk no longer has to oversee password resets, the department has also reclaimed two to three percent of its time back.
"We have improved our workflow and our customer service, as we now have more time to focus on serving our members rather than remembering and inputting lengthy passwords," said Thibodeau. "It has also enhanced our security since the solution provides an audit trail that tells us who accesses what information."
Eye, Finger and Voice Authentication
The rate at which biometrics will be adopted by financial institutions will be guided by ease of use rather than security concerns, according to Celent's Latimore.
"Historically, the effort to get the fingerprint technology up and running and to use it typically outweighed the benefit," he said. "So we haven't seen a lot of adoption and I wouldn't necessarily say it's due to security issues."
For San Mateo Credit Union, which supports eight branches, the employee-facing biometric technology was easy to implement and required about 10 minutes of training per employee. To date, Kneisler said that have been zero issues and no fail rates. "This solution has been a winner and we are very glad we made the leap."
Looking forward, Latimore estimates that finger scanning technologies will eventually be widely adopted. However, there are other biometric solutions vying for market adoption including vendors offering cellphone applications that capture a retina scan of a member's or employee's eye. And while it is purported to have a high security success rate, market adoption remains slow.
"We have seen demos of companies using cameras to take pictures of eyes to do blood vessel patter recognition, but who wants to look like they are taking a selfie to identify themselves and get into their bank account," questioned Latimore.
Whether credit unions drive the biometric trend—be it eye, voice or finger—remains unclear. What is clear, said Latimore, is that passwords and usernames will eventually become too cumbersome.
"Finger print scanning has the potential to significantly break the security trade off and is certainly worth examining carefully," said Latimore. "Voice recognition technology also holds this same potential because that is as simple as it gets with authentication."
