Mobile ID World recently caught up with Javier Mira, Co-founder and CEO, FacePhi, for an interview about the facial recognition company’s recent activity. The conversation begins with talk about the effect Apple’s Face ID has had on the mobile face biometrics market at large, as well as the substantial growth FacePhi has seen over recent years. The conversation moves on to the markets where FacePhi is seeing the most activity, the importance of liveness detection, and the emergence of branchless banks thanks to biometrics-enabled remote onboarding technology.
Shifting to talk of next week’s Money20/20 conference in Las Vegas, Mira announced a new multimodal solution from FacePhi, called InPhinite, which the company will be showcasing at the event. Mira is also participating in the FindBiometrics Moeny20/20 panel, AI & Biometrics Superheroes, Fighting Fraud Together, and in concluding the interview he spoke about the importance of artificial intelligence in financial biometrics.
Read our full interview with Javier Mira, Co-founder & CEO, FacePhi:
Peter Counter, Editor, Mobile ID World: Facial recognition seems to be going through a real mainstream boom right now. Apple just fully committed to face recognition in its new line of iPhones. How has Apple’s promotion of Face ID over the past two years affected your business, and face biometrics in general?
Javier Mira, Co-founder and CEO, FacePhi: When Apple presented the new Face ID technology with the iPhone X, a lot of clients and people related to biometrics were asking about what is going to happen with companies like FacePhi, that it somehow could be a challenge to have this technology from Apple. The real story here is that when Apple presented Face ID, it pushed banks or financial institutions into looking at facial recognition technologies. Before Apple, facial recognition was just one of a number of different biometrics that you could use for authentication or verification. When Apple presented Face ID, they showed that the new biometrics could be more convenient and in the next couple of years, the next big thing in authentication will be facial recognition. At that point, we noticed that many of our clients decided to start making POCs or pilots with our technology and the demand has grown quite a lot since that day, so for us it has been very good. Before, we were analyzing different options to present facial recognition, and now we are just defending the technology because the interest is already in the field.
Peter Counter, Editor, Mobile ID World: The numbers certainly support what you’re saying. Last year after the iPhone X was released with Face ID, FacePhi reported a 307 percent year-over-year profit increase, which is incredible. Would you say that there are some other factors driving that kind of growth as well?
Javier Mira, Co-founder and CEO, FacePhi: Not only is facial recognition growing a lot but I think that a lot of different biometrics are growing as well because more and more the authentication or verification technologies are trying to introduce or implement biometric systems in a variety of different sectors, not only in the financial sector. One factor is Apple Face ID but another factor is that biometrics technologies are becoming very strong. A third factor is that the number of interactions using mobile apps in order to get authenticated are growing in a big way every year. I consider all of these issues as affecting the growth of biometrics and specifically the growth of facial recognition.
Peter Counter, Editor, Mobile ID World: In what regions are you seeing the greatest demand for facial recognition?
Javier Mira, Co-founder and CEO, FacePhi: In our case, we are focused strongly in Latin America, from Mexico to Argentina and Chile. We are strong in that area. However, we’ve noticed in the past year that the Asian market is growing substantially in terms of adopting facial recognition technology. We introduced our technology in markets like Korea, Singapore, Indonesia and Hong Kong. From all of the meetings that we’ve had with potential customers there, the interest in facial recognition and impact of facial recognition is clear. On the other side, we see that Europe is gradually starting to pay more attention to facial recognition, but in terms of the financial sector they are a little bit behind the rest of the market.
Peter Counter, Editor, Mobile ID World: With the global popularity of facial recognition and the variety of facial recognition companies out there, what do you think makes FacePhi stand out? What do you think is the key to FacePhi’s level of growth?
Javier Mira, Co-founder and CEO, FacePhi: I think that one of the key points of FacePhi is that we’ve been really focused on financial institutions and we’ve been really focused on mobile channel, which means mobile applications or web banking. Three or four years ago we decided to be as strong as possible in this specific area. Whenever a client is asking for FacePhi’s facial recognition to be used on video surveillance or any other scenario, our technology can be implemented, but where it’s strongest in terms of our algorithms is on mobile channels. We combine very powerful algorithms for mobile devices together with a user experience that I would say is quite unique. When a bank is analyzing different companies and technologies before adopting facial recognition or integrating facial recognition in an app – it is really important because it ultimately ends up in the customer’s hand and this is the first step in direction with the current base of clients – they decide often on combining many things; convenient user experience, security, algorithms, the size of the template, there are several things. This combination makes FacePhi an industry leader in terms of facial recognition on mobile devices, specifically.
Peter Counter, Editor, Mobile ID World: You have some very advanced liveness detection at work there as well, correct?
Javier Mira, Co-founder and CEO, FacePhi: Yes. Facial recognition is a very convenient technology but at the same time, like any other biometric, you need to have a liveness detection capability that is able to determine if the subject is a video or a picture in order to avoid any possible fraud. Two years ago, we had a system based on the blinking of the eyes that required you to blink in front of the camera at a specific time. Now, we have another technology that is based on random movement of the head. The client can select both technologies, only one, recognition based on two random movements, only one movement and so on. This depends on the scenario and on the risk of the transaction. Based on these factors the client can decide whether or not to use liveness detection.
Peter Counter, Editor, Mobile ID World: FacePhi’s technology allows for both biometric access on mobile and also mobile remote onboarding, which is a new application that seems to be taking off around the globe. Do you think that eventually we will be seeing digital banks without branch locations or offices, thanks to this technology?
Javier Mira, Co-founder and CEO, FacePhi: I would say that it’s a fact. Today we have between 20 to 25 accounts using our technology and we hope to end the year with about 30 accounts. We started selling and deploying digital onboarding technology at the beginning of this year, and today we have six banks using this digital onboarding technology with good success. We work with both types of banks. We have banks with large numbers of branches that are using this technology to generate new clients who can open an account without visiting a physical branch. At the same time, we have some digital banks with no physical branches who are acquiring new clients only with digital onboarding. We noticed a long time ago that there was a big demand for that, so we made an alliance with a company that specializes in analyzing ID documents. We combined that technology with our facial recognition technology into a digital onboarding package that has had quite a lot of success.
Peter Counter, Editor, Mobile ID World: From the perspective of financial inclusion, it seems that a branchless bank entering a market such as Southeast Asia where there are a lot of unbanked individuals is going to be in especially high demand.
Javier Mira, Co-founder and CEO, FacePhi: Absolutely. You have digital banks, you have payment platforms and you have different scenarios that are all trying to make it easier in order to acquire new accounts. By having a digital onboarding system, it makes it quite convenient and easy to connect with the client and I think its mandatory for success in the future for those companies.
Peter Counter, Editor, Mobile ID World: In August, FacePhi announced a new partnership with Bantotal. What are some of the benefits that this partnership will bring?
Javier Mira, Co-founder and CEO, FacePhi: FacePhi is actually a facial recognition technology company going directly to the banks in order to introduce this technology for apps, or web banking, or ATMs, etc. but it seems that in the last couple of years the interest in facial recognition has changed the market. Now we have several partners, similar companies like Bantotal that integrate our facial recognition technology in their own solution. In the case of Bantotal, its core banking, currently used by 40 to 50 banks. This type of agreement is good for us because we start opening new accounts and new banks without having to do presales or following up because those partner companies are helping us to increase sales and increase the number of banks using our technology. Besides Bantotal, in the United States we are partnered with Entrust, Easy Solution, TCS, and BioConnect in Canada. It’s a different business model that we can use to get our technology in many more banks than if we just tried to do it on our own.
Peter Counter, Editor, Mobile ID World: That can open you up to so many different global markets which is important.
FacePhi will be attending Money 20/20 in Las Vegas this month. What can we expect to see from your company at this event?
Javier Mira, Co-founder and CEO, FacePhi: Money 20/20 for us is the “big show.” This year is going to be the third year that we attend as a 4-star sponsor, and we’re going to be releasing a new technology. We are presenting a new framework of authentication, called inPhinite. It’s a framework, a completely new solution that includes digital onboarding and authentication not only with our facial recognition product SelPhi but it will also include a new biometric – periocular biometrics – that includes 100 percent proprietary algorithms, plus it will have voice recognition authentication, sign recognition technology and touchless fingerprint technology. These three new technologies are all coming from alliances that we’ve been working with in the past months with top companies in the world in each of these specific technologies. We are using our experience with UI and UX as well as combining these technologies into a unified product called inPhinite. This is what we will be presenting at Money 20/20. We know that clients are expecting this type of solution because they are so happy with our facial recognition and their experiences with FacePhi in the last couple of years that they are demanding more biometric authentication alternatives to tokens, SMS and password options for use in any transaction.
Peter Counter, Editor, Mobile ID World: That sounds fantastic. Can explain a little more about the contactless fingerprint technology?
Javier Mira, Co-founder and CEO, FacePhi: It’s a touchless technology that uses the camera of a device and it’s capable of analyzing and matching a fingerprint.
Peter Counter, Editor, Mobile ID World: Do you think that with that sort of scalability, it sounds like it’s going to open up your technology for authenticating much higher risk scenarios?
Javier Mira, Co-founder and CEO, FacePhi: Exactly. When a bank is using our facial recognition technology, they can’t decide whether to use it at the login moment or just to authorize a transaction. In any case, they have different transactions and different levels of risk so they are using facial recognition but they also still have to use a token, SMS or PIN code. They try to implement new biometrics but at the same time, you can’t use the same biometric twice. If they are using facial recognition for login, they need another biometric for second factor in order to authorize a transaction. They are asking us to provide this type of solution and inPhinite is designed to solve that problem.
Peter Counter, Editor, Mobile ID World: I am really excited to take a look at this and see it in action at Money20/20. Also, at Money20/20 you will be participating in a FindBiometrics panel about AI in biometrics. Can you comment on how much artificial intelligence has changed biometrics in finance?
Javier Mira, Co-founder and CEO, FacePhi: It’s true that AI is helping biometrics in order to be more accurate and it’s a big change. In our case, our technology is using AI in order to be less static as an algorithm could be. It’s designed to be dynamic; to learn from your face with all the changes you have on a daily basis. AI is being used, especially in our biometrics in a very hard way, especially in the last year. We are using AI deep in the algorithms.
Peter Counter, Editor, Mobile ID World: This is my last question and I think I know the answer based on our conversation, has 2018 been a good year for FacePhi?
Javier Mira, Co-founder and CEO, FacePhi: 2018 is going to be a good year for us. We expect to maintain the growth that we’ve had over the past two years. We’re maintaining the growth in the number of accounts and we’re probably maintaining growth in revenue and profitability. We are really excited about seeing the end-of-year figures. We’re really happy. The momentum is really good for the company.