By: Joe Gillen
Identity theft and fraud affect upwards of 10 million Americans annually, according to data from the Federal Trade Commission. As more consumers utilize online and mobile banking, many fear that the incidence of this type of crime may increase. This is not necessarily due to issues with financial security systems themselves, but instead may result from Americans' weak passwords and other login vulnerabilities.
According to a 2012 Online Registration and Password study, conducted by Harris Interactive, the average American maintains 7.9 unique passwords across several accounts. This can create issues in and of itself in remembering these passwords, and 40 percent of respondents report having to ask for assistance at least once every month due to forgotten login information. Other individuals who do not want to deal with several passwords may make the mistake of using a single word or phrase for each of their financial accounts, a scenario that makes them particularly vulnerable when malware or hackers try to obtain personal data.
In an effort to tighten security and provide more convenience to bank members, numerous financial institutions are considering the capabilities of biometric features. For example, many aspects of biometrics - such as photo and voice recognition - can be easily facilitated by mobile devices, according to American Banker. The majority of smartphones are equipped with high resolution cameras that most people already utilize to take images of friends, family and events. Therefore, utilizing the camera feature for photo recognition to log into a mobile banking platform would not be difficult. The same may be true for voice recognition software, which would be used to authenticate a person's vocal patterns, the news source reports.
Adoption hindered by several factors
While most analysts agree that biometrics are likely to be taken more seriously in the next several years, full-scale adoption may be a long time coming. Many consumers - such as those who have not purchased a smartphone - would largely be left out of these security measures, making adoption uneven across several demographics. In addition, biometric security can be an expensive endeavor, and those institutions that are currently facing hardship as a result of the Dodd-Frank Act may be unlikely to channel significant funds into developing these capabilities.
Although biometrics may one day become part of a wider security revolution in the future, many institutions are making security part of their core banking strategies in the present to gain a larger market share. This is especially true for those rolling out mobile banking platforms, a feature that many consumers are still reticent to adopt due to perceived fears about security. In response, many banks are promoting the merits and safety features of this type of banking system.