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US & Canadian consumers reluctant to swap passwords for biometrics for fear of identity fraud

Paysafe launches new global research into consumer payment trends in North America and four key European markets

MONTREAL. June 3rd, 2019 – Over half of consumers in the US (52%) and Canada (53%) are worried that the shift to biometrics to authenticate online payments will dramatically increase identity fraud, according to new research conducted by Paysafe, a leading global payments provider. The research found that four fifths of consumers in the US (81%) and Canada (83%) still favor passwords for making payments online due to concerns about the security of new biometric options.

According to the data, two thirds of North American consumers – 68% of Americans surveyed and 70% of Canadians – worry about being able to pay for goods or services without being asked for a password. Only a third of Americans (34%) and 40% of Canadians believe that biometrics are more secure than other authentication methods.

The report, Lost in Transaction: The end of risk?, explores consumer attitudes to biometrics prior to the roll-out of Strong Customer Authentication (SCA) later this year. The annual study tracks changing views on payments across the US and Canada as well as the UK, Germany and Austria, with this year’s report including Bulgaria for the first time.

Those consumers who didn’t feel comfortable using biometrics identified a lack of trust as their primary reason for avoiding them. The research also revealed further fears around the use of biometrics:

  1. Nearly half of Canadians (49%) and 39% of Americans stated they did not want companies having access to their personal biometric details;

  2. 34% of US consumers and 39% of Canadians did not know enough about biometrics to trust it;

  3. Nearly a third (29% across North America) were concerned that their fingerprint could easily be cloned and used to commit fraud;

  4. 27% of Americans and 28% of Canadians said biometrics did not seem safe.

Commenting on the research, Daniel Kornitzer, Chief Business Development Officer, Paysafe Group, said: “Biometrics are a huge opportunity for the payments industry to combat the increasing risk of card not present fraud. However, it’s not surprising that there is reluctance among consumers to use biometrics as a form of payment authentication when passwords and PINs have been the central pillar of financial data security for at least 20 years. News headlines are also dominated with fraud and hacking scandals, so the public are aware of the risks involved when it comes to adopting new services. To overcome this, consumer education is imperative and with SCA coming in September, consumers will need to be aware of the benefits to ensure acceptance and adoption. We’ve lived in a password-driven world for many years now and consumers aren’t fully prepared to let go of what they know.”

Despite the worries over biometric transactions, adoption continues to grow with close to half (46% percent) of North American consumers having used biometrics to make a payment. Well over half of US and Canadian consumers (56% and 59%, respectively) also agree that using biometrics is a much quicker and efficient way of paying for goods and services.

When asked which biometrics they had used, fingerprint technology was most common, used by 38% of Americans and 34% of Canadians.

Kornitzer continued: “Consumer acceptance of biometrics is being driven largely by smartphone usage and adoption, and this will only increase. However, payment providers will need to do their bit to get consumers on board. Ultimately, SCA should lead to smoother and more secure payments – a win for businesses and consumers alike.”

To read the report in full, please visit https://www.paysafe.com/lost-in-transaction-the-end-of-risk/

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