Using a selfie to verify your online card payment - the technology is here

Biometrics technology partly developed in Dublin could play a central role in encouraging consumers to embrace two-factor authentication for online payments.

Mastercard is hoping its Identity Check solution will become the technology of choice for banks looking to meet new requirements for verifying identities online as set out in the (Revised Payment Service Directive) (PSD2) legislation.

The technology, which has been developed in part at the Mastercard Labs facility in Leopardstown, enables users to use biometric identifiers such as fingerprint, iris and facial recognition to verify their identity.

PSD2, which is commonly referred to as the ‘open banking’ directive, came into effect earlier this year. Stricter requirements for authenticating payments known as strong customer authentication (SCA), are to be introduced as part of the legislation next September. These will likely have ramifications for almost all companies doing business in Europe as they require payments to be authenticated using at least two different factors, one of which can be a biometric identifier.

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Identity Check is one of the solutions being put forward by companies to help banks with this. It helps users verify who they are via a mobile device during online shopping and banking activities to help sped up transactions, reduce abandonment rates and improve security.

According to Mastercard, currently just 1 to 2 per cent of all online transactions that take place in the Republic require cardholder authentication to complete a transaction, with a password being the usual means to do this. However, it expects this to jump to as much as 25 per cent of transactions from next autumn when the new requirements covering authentication come into effect.

More straightforward

Mastercard, which employs more than 400 people in the State, including more than 200 at its Dublin-based R&D lab, is hoping that by making it possible for users to verify their identity using techniques such as selfies, life will be made a bit easier for consumers.

Research conducted by the company shows that online authentication methods such as Verified by Visa and its own Securecard are so painful to use that up to a quarter of all transactions that require them are abandoned. In addition, while 97 per cent of all offline transactions are approved by banks, only 86 per cent of online ones are.

"The use of passwords to authenticate someone is significantly outdated, with people forgetting them and retailers facing abandoned shopping baskets. In payments technology this is something we're closing in on as we move from cash to card, password to thumbprint, and beyond to innovate technologies such as artificial intelligence," said Sonya Geelon, country manager for Mastercard in Ireland.

Mastercard, the world’s second biggest payments company, recently announced plans to create 175 new tech jobs in the Republic as it looks to bring more digital solutions to market. The company announced plans to hire across a number of areas, with roles for software engineers, blockchain specialists, data scientists, project managers, analysts, product designers, cloud infrastructure specialists and information security experts.