Monday, April 9, 2007

Buy a Vegemite Sandwich with Pay By Touch

SYDNEY - Imagine a day when the only item you'll need to take to the supermarket to complete a transaction is your index finger.

The concept is already a reality in a limited capacity in some places around the world but observers believe the technology should become mainstream by 2012.

Using biometric scanning to make transactions is expected to be part of a revolution in payments technology.

The long reign of swipe-and-sign plastic cards appears to be weakening with retailers and others considering new ways to make the payment process more secure and faster. Even Citibank, the world's largest credit card issuer, seems to have accepted this reality, partnering with a major biometric payment processor last October.

US based NCR, says the next phase of the technology is to get customers feeling comfortable with the idea of using their biological information to make casual purchases.

Leading the charge in this area is another US company, Pay By Touch, which uses biometric technology to allow consumers to pay for purchases and access loyalty discounts at checkout

Pay By Touch has partnered NCR to merge the fingerprint authentication system with NCR's biometric point-of-sale hardware allowing US consumers to make purchases at selected stores.

Biometric information in its various forms has gained acceptance in a number of government environments, predominantly for security reasons.

And in the consumer sector, a number of Japanese and South Korean banks are using fingerprint scanners as a form of identification at automated teller machines.

Christophe Uzureau, a research analyst with Gartner, says the biggest hindrance to the advancement of the technology in retail is public perception about privacy. People don't really understand biometrics. Once they do, they will see it as a more secure, safer transaction. And once this hurdle is cleared, biometric payment systems could give some leverage to retailers looking to move their revenue streams away from credit.

"What's happening is a much more flexible market place," Uzureau said.

"The idea is to put pressure on the card industry and improve the negotiating power of merchants."

Gartner expects fingerprint purchases to grow quickly and eventually become a mainstream reality in five to 10 years.