Nick Dryden was assisting Mastercard in developing wristbands for making transactions at music festivals when he concluded that wearable payments were adding more complexity than they were worth.
“There were technology issues with how we topped up the wristbands, and it just created another queue, so I began to think about how it could be done differently,” says Dryden, now CEO of Sthaler Ltd., the London-based company that developed Fingopay for vein ID biometrics. “I began testing different biometrics and the only one I found to be reliable enough was finger vein ID.”
The concept of biometric technology for mobile banking and payments has become increasingly popular in the U.K., with a 2017 Oxford University survey finding that 93% of consumers prefer the idea of biometrics to PINs or passwords, as do 92% of banks. But to date, payments companies have been reluctant to deploy such technology amid concerns that common biometric methods such as fingerprint or iris scanning are both unreliable and susceptible to hacking.
However, there’s growing evidence that finger vein ID could prove more palatable.
Over the past year — running from September 2017 to June 2018 — Sthaler have carried out the first-ever supermarket trial of Fingopay at Brunel University’s Costcutter store, with another trial currently underway in restaurants and coffee shops at Copenhagen School of Business.
Fingopay works by using near-infrared light to scan the movement of haemoglobin through the three main veins in a customer’s finger. When a customer signs up to use the system, the unique 3D image of their vein patterns is encrypted in the form of a number, stored in the cloud, and linked with their bank details. From then onward, whenever the customer scans their finger at a checkout till, the payment is automatically processed, just as if using a contactless card.
With speed becoming ever more important to consumers — a survey this year by retail software provider Omnico found that 56% of shoppers would not return to a store after a bad queuing experience — Fingopay has proved extremely popular. It takes just 200ms to match biometric data to its database and a further two seconds to process a transaction.
In the Costcutter trial, footfall increased by 11% during the time Fingopay was active, with approximately 4,500 customers signing up to use it. Likewise, 880 customers signed up with the payment platform in just five weeks at Copenhagen School of Business, with Sthaler survey data showing that 85% found it more convenient than conventional payment methods.
The surveys suggest this popularity is also because customers perceive it to be more secure.
“The science of lifting a fingerprint has been known for decades, while other biometrics like your voice and face can all be acquired by someone in the same room without your knowledge,” Dryden says. “But this is much more secure because the system can only be initiated by receiving a vein pattern, which is completely internal. We don’t store any live biometric data in the cloud either, so no one could get access to the system that way. If anyone did break into our databases, they’d just be left with a set of cryptokeys, numbers that they can’t actually use.”
Fingopay is currently under consideration as a permanent payment option at a variety of venues across Manchester — ranging from sports stadiums to university campuses, major entertainment venues, and the metro — beginning later this year.
In addition, Sthaler is also in negotiations with a range of U.K. supermarkets and is discussing potential partnerships with major banks. “The idea would be for consumers to sign up for Fingopay in your bank branch which provides some sort of KYC process,” Dryden says.
Over the next two years, the major focus will be bringing Fingopay on a large scale to Manchester.
“The City of Manchester council are really behind it,” Dryden says. “Because there will be multiple points of acceptance, lots linked locations that will be accepting finger payments, we’re confident it will be successful.”
