Credit card fraud is the most prevalent type of identity theft, accounting for $28 billion in global losses in 2018 alone. SmartMetric is aiming to dramatically reduce credit card fraud through their new biometric credit and debit cards, which they announced in late October.

As U.S. credit and debit cardholders know, many credit cards require no PIN to confirm purchases. The current payments ecosystem creates potential goldmines for hackers, who simply need to spend on the credit card in such a way that it is not reported as suspicious to the credit card company. From the consumer’s perspective, they are wholly reliant on real-time detection by their card company or post-fraud refunds.

There needs to be improved safeguards securing consumer credit and credit cards, and leveraging biometric information, which is unique to the cardholder, poses a potential step in the right direction. As Chaya Hendrick, CEO and President of SmartMetric argues, “Using a cardholder’s biometrics to identify and authenticate the card user provides a giant leap forward in credit and debit card security over the poorly secure PIN used on today’s payment cards.”

How the SmartMetric Card Works

The design of the SmartMetric card is simple: pull out your card and swipe your finger over the built-in fingerprint reader. The owner’s fingerprint is stored on a chip that is separate from the chip used to process transactions inside the card. If your fingerprint matches the stored fingerprint upon swiping, the card will be enabled to make a purchase.

WIth the SmartMetric card, your fingerprint is never stored in an offline database or in any other location in which your biometric information could be compromised. The storage of the fingerprint on the card itself provides an additional layer of protection against fraud.

The Future of Biometric Payments:

The biometric payments market is exploding globally, which is projected to grow nearly 20% per year to $77 billion by 2027. Within that market segment, independent research firms project that, by 2025, there will be more than 500 million biometric credit and debit cards globally. There are already seven billion chip-based cards that have been issued globally, and a logical next step in this process could be the biometric credit card. This means that there will be a land grab in the United States for whom can provide the most secure, easy-to-use and customer-friendly card. SmartMetric knows they need to beat their competitors to market, which is why their manufacturing capacity for the SmartMetric card exceeds one million cards per month.

Reported incidents of identity theft have nearly doubled in the United States over the past five years. Privacy and securing transactions is becoming a central concern to consumers, evidenced by Apple’s recent push to highlight their commitment to user privacy in their most recent advertising campaign. By reducing the most common form of identity theft, SmartMetric’s biometric card offers an exciting prospect to protect consumers in an increasingly dangerous world.

ABOUT THE WRITER:

Quinn Barry is a Tech Innovation Fellow from Stanford University covering the next generation of financial identity protection.