Bank United of Texas' deployment of automated teller machines with iris-recognition technology is bringing new attention to that form of biometric identification-and to questions about cost and accuracy.
The Houston-based thrift is the first U.S. financial institution to announce a broad ATM-network rollout of the eye-scanning method as a security enhancement. Other U.S. institutions have tested the technology, and it is in live operation only at Nationwide Building Society in England.
Bank United is using the biometric system from Sensar Inc. at three ATMs in Kroger supermarkets in Houston, Dallas, and Fort Worth.
A Bank United spokesman said that next year iris identification will be installed at ATMs in 60 Kroger banking centers. Plans have not been formulated to outfit the thrift's 80 conventional branches.
Though the iris biometric method is regarded as relatively cheap, secure, and user-friendly, there may be pitfalls, said Raj Nanavati, a partner at International Biometric Group of New York. Though no two people's iris patterns are alike, they may be similar enough to confuse the scanning technology, he said.
According to Sensar, the iris has 266 unalterable features that can be measured. Fingerprints have about 30 features, which can change over time.
In the competition with fingerprints and other methods based on physical characteristics, Sensar and irises got a boost last fall with a $28 million capital infusion from Citibank, J.P. Morgan & Co., NCR Corp., and others.
Moorestown, N.J.-based Sensar said its technology was 100% accurate during a test run by Nationwide. But Mr. Nanavati said the accuracy had not been tested by a third party.
Mr. Nanavati also questioned the cost-benefit. He said ATM fraud losses are under $100 million a year-compared with credit card and check fraud of about $1 billion.
An ATM equipped with an iris sensor costs $35,000, a few thousand dollars more than a regular machine, said a spokeswoman for Diebold Inc., Bank United's vendor. The Bank United spokesman said it would cost no more than $5,000 to install the technology in the 60 ATMs.
Mr. Nanavati also expressed a logistical concern. Customers identified by their irises would not be able to use another bank's ATM unless the iris information were shared by all banks.
But the consultant, who advocates biometrics as far superior to personal identification numbers, said he is "encouraged and pleased" by the Bank United introduction.
Bank United customers will be educated about the new technology through in-store promotions, the spokesman said.
A message on the ATM screen instructs users to face forward, and a Sensar device verifies the identity within seconds. The iris can be scanned through glasses and contact lenses and is not affected by eye surgeries.
Pilots of Sensar's technology, which is licensed from Iriscan Inc. of Marlton, N.J., are under way or planned in Japan, Germany, Italy, Spain, Brazil, Turkey, Norway, Mexico, and Malaysia.