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A Brief History of Biometric Technology

by Danny White

Biometric technology has many applications – from commercial to public consumption. In the digital age, it has become a vital part of fraud prevention measures. Criminals have targeted enterprises in different industries because of the valuable information, data they manage, and funds or other assets they keep. One of the most targeted industries is the financial sector.

Consequently, countries across the globe implement various regulations to prevent financial-related crimes, including Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) and Know-Your-Customer (KYC) directives. As such, regulatory agencies require banks and other financial institutions to shore up their security measures to protect their clients and ensure they are who they say they are.

In the European Union (EU), payment services providers are mandated to comply with the Payment Services Directive (PSD2). This regulation aims to make the European payments market more integrated and efficient, leveling the field for all industry players. It also aims to strengthen security when it comes to payment transactions and ensure the protection of consumers and businesses.

Under the PSD2, regulated entities must implement Strong Customer Authentication (SCA) to minimize fraud risks in electronic transactions. Meaning, they must use multifactor authentication (MFA) that leverages a robust combination of two or more of the following credentials:

  • Knowledge factors (something you know like a password or a PIN).
  • Possession factors (something you have like a key material).
  • Inherence factors (something you are like the use of fingerprints or facial biometrics).

MFA provides a multi-layered barrier against fraudulent attempts as it requires a user to provide all necessary credentials before they can access an account or confirm a transaction. Among all the authentication factors used in MFA, biometrics is regarded as one of the most secure since it is not easily susceptible to common circumvention tactics.

Biometric technology has come a long way since scientists started working on its research and development in the 1960s. To know more about how modern biometric technology came to be, see this infographic from LoginID, which details its history.

Biometric Technology: a brief history

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