Although it sounds more like something out of a science fiction novel or movie, facial recognition is gaining ground as a technology for identify verification. If you have an iPhone, you may already be using this biometric method.
Rather than entering a password, your smartphone recognizes you from a scan of your face that it took when you first used it. From there, many more apps have integrated the facial recognition technology. Now, the idea of facial recognition technology is moving into the payments environment to increase security and convenience for consumers.
Premise Behind Facial Recognition Technology
Facial recognition uses mathematical algorithms to capture, extract, compare, and match a face to a person’s identity. First, physical samples are collected through a scan and then the data is extracted for comparison purposes.
The final stage involves making a decision about identity matches based on an existing image stored in a facial database. Thanks to the integration of artificial intelligence, the entire process only takes a few seconds.
The question is, will this biometric technology work for payments?
China Says Yes
China already thinks paying with your face will work. Chinese consumers are already using it in popular apps, including Alipay, which uses a person’s face as their credentials to transfer and receive money through the app. The app call refers to the method as their “smile to pay” option.
The country already uses biometrics for so many other aspects of lives that citizens are used to the idea of this level of surveillance. Since 2017, customers of Kentucky Fried Chicken outlets in China have been able to use face scans to buy food.
Now, the country is testing other facial payment applications, including subway payments in Shenzhen. A person’s face is linked to a payment account to gain entry. While it’s only being used at one subway station, the pilot program will be a way of determining if facial payments have a wider application.
Right now, there are some aspects of it that may feel inconvenient to consumers, including having to register their face and preferred payment account at least a day in advance of traveling on the subway. However, it will mean that a consumer no longer has to keep track of their subway card.
Another company, Sunmi Technology, announced another facial payment product set to launch in China as part of a partnership with Alipay. It is available for a wide range of payment applications, including those for retail, restaurant, hospitality, parking and more.
Accuracy Makes It Promising
Many companies that produce facial recognition software, like Baidu, note that facial recognition is 99 percent accurate. The company has used experiments to prove this level of accuracy, helping pave the way for using it in the payments world where identification is critical and fraud is a major concern.
U.S. Companies Test Facial Payment Technology
Now, companies in the U.S. are beginning to show an interest and launching pilot programs to determine if facial technology will work. For example, CaliBurger in California allows customers to pay for orders using artificial intelligence and facial payment technology.
It’s also viewed as a way to enhance their customer loyalty efforts because the data collected also includes their habits and preferences. This information can be used to personalize future recommendations and interaction.
Pros and Cons to Using Facial Payments
The pros include greater security levels for payments through biometric identity verification than other security tools. This is nearly impossible to crack like the fraud committed with other types of payment methods. Another pro is that the facial payment technology is relatively easy to integrate into an existing payment system.
As already noted, it’s a highly accurate process. It also can be fully automated for greater efficiency and reduced friction for the payment process, helping to improve the customer experience.
However, there are also cons to consider. First, there is a lot of data that must be stored, protected, monitored, and managed. Then, image size and quality are still evolving, which means that image processing has a way to go. The surveillance angle is key in terms of ensuring customers understand how they must stand for scanning purposes. Certain issues can arise with color contacts, glasses, and facial hair.
The overall conclusion is that facial payment technology shows potential for addressing many issues related to security and the overall customer experience. However, technology does need to improve. Additionally, in the U.S. where the idea of a surveillance society is still not completely accepted like China has done, it may take more time for this payment method to be widely adopted.