In the short span of a handful of years, biometric smart cards have emerged as a major segment of the overall biometrics and security markets. And it looks like, going forward, they’re only going to get bigger thanks to the emergence of biometric payment cards. That’s why this November is Biometric Smart Cards Month at Mobile ID World, in which we will bring you in-depth features on this exciting new technological area.
A good place to start is by looking at how the industry arrived here. Analyzing the driving factors behind biometric smart cards not only helps us to understand the state of the art today, but it also helps to illuminate where the industry is headed.
Physical Access Turns to Biometrics
The story of biometric cards is one of intertwining trends in the areas of physical access control, mobile authentication, and payments. In the domain of physical access control, smart cards have long been in play; indeed, swipe-based and even contactless smart cards are now considered standard features of physical access, with everyone from medical staff to factory workers to retail employees using cards to gain access to the employee-only areas of their workplaces.
But in recent years, biometric technology has started to come into play. Cards are increasingly being paired with biometric scans in order to further secure access points, and some smart ID cards have started to directly incorporate biometric tech. As far back as 2016, fingerprint recognition specialist Zwipe incorporated a fingerprint sensor into a smart card solution, while Face Forensics devised a system in which face biometrics are encoded into an access card. This tied into and supported the emergence of biometric access control systems that could forego access cards entirely, a trend that is still rising today.
A Mobile Gold Rush
Meanwhile, in the world of mobile biometrics, another trend was underway. Apple had catalyzed the mobile biometrics revolution with the introduction of its fingerprint-scanning Touch ID system in 2013’s iPhone, and in its wake a wave of copycats flooded into the smartphone market. These were heady times for fingerprint sensor specialists, who suddenly found lucrative opportunities for integrating their solutions in the mobile sector. Fingerprint sensors became standard features of contemporary smartphones in remarkably short order.
As with so many other gold rushes, however, the flood of competition led to a supply glut. At the same time, technological advances were making smartphone-targeting fingerprint sensors cheaper to make. Average Selling Prices started to drop, and so did the profit margins of major sensor makers. But some of the more savvy players were also looking to other application areas of their fingerprint sensor technologies; and with demand for biometric tech on the rise in the world of access control, the biometric smart card became an exciting new opportunity.
IDEX, for example, was a notable supplier of fingerprint sensors in the mobile market around this time. It had also seen its fingerprint sensor tech ordered for access card integration as far back as 2014. But at the height of the mobile fingerprint sensor revolution, it was seeing new opportunities in the biometric cards space, with management revealing in a late 2017 investor update that they expected biometric card integrations to become an increasingly important part of their business in the coming years – and that they were aiming to get 30 percent marketshare in biometric payment cards by 2020.
Easier Payments, But What About Security?
This brings us to the final strand in these intertwining trends – the move toward contactless payments. NFC-based payment cards have gained considerable traction around the world over the last several years, thanks to the convenience of allowing customers to tap-and-pay, with no need to enter a PIN so long as transaction values don’t exceed a certain threshold. But many want that threshold to be higher, even as concerns remain about the relative lack of security on contactless payment cards – after all, a stolen card could easily be used to make a number of small transactions before being deactivated.
This is where the biometric technology initially conceived for physical access cards offers a solution. Innovative leaders in the biometrics and payment sectors alike realized that, given the form factor, this tech could be brought over to payment cards. And they got to work, with major credit card companies partnering with banks and biometrics specialists to develop and trial fingerprint-scanning payment cards.
IDEX was one of the first on scene, supplying fingerprint sensor technology to Mastercard for pilot projects that got underway in early 2017. By the start of 2018, IDEX was announcing that it would start to focus exclusively on biometric smart cards, seeing major business opportunities in this area. Others followed suit, with Visa starting its own biometric card trials, and biometrics specialists like Fingerprint Cards, Precise Biometrics, Zwipe, IDEMIA and Gemalto all getting in on the action.
Today, dozens of these trials have been concluded or are in progress; the major technological hurdles have been cleared; manufacturing and supply networks are locking in place; and the major players are preparing for large-scale commercial rollouts. Meanwhile, the physical access space in which this technology initially emerged may ultimately show even stronger interest in fingerprint-scanning cards if they go mainstream in the consumer sector. All of which makes for a lot of excitement in the biometric smart cards market, which appears to be on the cusp of a gold rush of its own.
Biometric Smart Cards Month is made possible by our sponsor IDEX Biometrics.