Biometrics are quickly becoming essential for financial institutions as passwords and one-time passcodes struggle against today’s advanced fraud tactics.
Traditional authentication, once considered sufficient, is now leaving gaps in security, much like guarding a house with a cardboard door. For mid-tier North American banks and credit unions in particular, the threat landscape has changed, and authentication must evolve in response.
SymphonyAI, which offers AI-powered financial crime prevention solutions, has delved into why financial institutions cannot ignore biometrics.
Fraud today is far more sophisticated than simple password guessing. Criminals no longer rely on brute force methods but instead exploit stolen credentials through large-scale data breaches, social engineering, and automated bots that mimic human behaviour.
Device-based verification, once seen as a safety net, is itself vulnerable to SIM swaps and malware. Deloitte has projected that synthetic identity fraud could cost financial institutions as much as $23bn in losses by 2030. To tackle these risks, fraud teams are increasingly turning to behavioural intelligence and biometrics as frontline defences, it said.
Far from being just an optional add-on, biometrics now form a critical layer in fraud prevention strategies. They are also fundamental to building digital trust with customers, SymphonyAI explained.
Modern biometric solutions go well beyond fingerprint scanning. They include facial recognition, which ensures physical presence; voice recognition, which can analyse tone, cadence, and stress; and behavioural biometrics, which track unique patterns in the way users swipe, type, or hold their devices. Unlike static checkpoints at login, behavioural biometrics offer continuous authentication, flagging unusual behaviour mid-session and preventing unauthorised access before a transaction can be completed.
The impact of biometrics also extends to customer loyalty and trust. When financial institutions adopt visible, effective security measures, customers feel reassured and are more likely to remain loyal. McKinsey has estimated that organisations investing in digital trust could unlock up to 10% annual revenue growth, underscoring the business case for biometrics alongside the security benefits.
For mid-tier banks, adoption does not require massive budgets. Practical first steps include integrating behavioural biometrics into online and mobile sessions, enabling fingerprint or facial recognition in apps, and deploying voice authentication in high-risk call centre interactions. Just as importantly, financial institutions must educate customers about the role of biometrics, positioning it as a means of protecting them, not just the bank.
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