Biometrics are quickly replacing passwords as the preferred method of authentication across the financial services sector.
Traditional security methods such as SMS codes and static passwords are proving increasingly vulnerable to fraud. Regulators across multiple jurisdictions are encouraging, and in some cases requiring, banks to integrate biometrics such as facial recognition, fingerprints, and even behavioural patterns to enhance security.
SymphonyAI recently delved into how this shift is not simply about innovation but is rapidly becoming a compliance requirement.
Regulatory pressure is mounting globally. In the EU, PSD2 mandates strong customer authentication that uses two of three elements: something you know, something you have, and something you are. Biometrics naturally fit into the ‘something you are’ category, making them a regulator-approved solution. In the UK, the Financial Conduct Authority supports PSD2-aligned requirements, encouraging financial institutions to use behavioural biometrics to fight fraud without causing unnecessary friction.
In the US, the lack of a single federal biometric law means banks must navigate a patchwork of state-level regulations while complying with broader rules like the Gramm-Leach-Bliley Act. India’s Reserve Bank promotes biometric authentication through Aadhaar, the world’s largest biometric ID system, while the Philippines’ central bank plans to phase out SMS one-time passwords by June 2026 in favour of biometric and passwordless authentication. Malaysia’s e-KYC guidelines already require biometric checks for digital onboarding, and Australia’s Scams Prevention Framework is preparing similar requirements.
SymphonyAI noted that behavioural biometrics, which analyse how users interact with devices—such as typing speed, swipe gestures, and mouse movements—offer seamless security benefits. Unlike static credentials, these systems work invisibly in the background, improving both fraud detection and user experience. Customers benefit from faster, frictionless onboarding, while banks meet tougher compliance demands.
The technology also provides adaptive defences that evolve with emerging threats. Static security tools are like fortress walls—effective but limited—whereas biometrics act as intelligent sensors, learning and responding dynamically to attacks, it said.
For more about how biometrics are improving compliance, read the full story here.
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