The annual report that we published today shows that Fingerprint technology is well on its way to become a de-facto standard for secure and convenient authentication of mobile devices. Pareto Securities Equity Research believes that the global market for smartphones with fingerprint technology will continue to grow rapidly and be present in more than 80% of all smartphones in 2020. New areas of application for fingerprint recognition are expected to take off during 2017, having the potential to be at least as big as the market for smartphones. These areas include wearables, cars, IoT, smart cards and payment cards. The latter has the biggest potential for growth. The use of biometrics in financial solutions is expected to increase by an average of more than 50 per cent a year until 2020. The same year financial products and services will account for one third of the total market for biometric solutions and will be worth 11 billion US dollars.

Contactless payments are the future
Card payments of the future will increasingly be contactless, where the payment card uses wireless technology to communicate with, for example a card terminal. Biometrics is considered as a convenient and secure authentication method for contactless cards to minimize security risks. Contactless cards are expected to reach 90 percent usage by 2020, and six out of ten contactless payment cards are expected to have fingerprint recognition.

Focus on security
An increasingly connected world, also increases the risks of theft and fraud. The cost of card fraud is expected to continue to rise rapidly. Payment cards with fingerprint technology can offer higher security than normal payment cards. Security is based on a Secure Element, a platform that protects against intrusion and manipulation and has fingerprint recognition integrated. Payment providers are currently evaluating payment solutions with fingerprint recognition. The payment cards’ limitations of space, memory and processing power demand powerful, effective algorithm solutions that provide fast and secure matching in much more limited platforms than is the case for the mobile market. Fraud and an increasing use of false fingerprints has also made anti-spoofing and liveness detection, the ability to differentiate between a finger from a living person and an artificial copy, a priority. All to increase the security of fingerprint technology.

This is a summary of the article “Smart cards the next major growth area” in Precise Biometrics annual report. Read the whole article including sources, here.