Identity: the new payment

11 January 2019

When you think about it, in-store card payments are de facto data payments already. A digital solution with personal data being used to complete the transaction. For retailers, the true value is in that very data. After all, the more you know about your customer, the better and more personalised the offers you make them will be.

Big data, big tech, big returns

All the big technology companies have business models that revolve around data acquisition and exploitation. That data can be names and addresses, or viewing patterns, or online search behaviour, or previous purchases. A wealth of knowledge. In exchange for the free use of their services, the onlife consumer has become accustomed to parting with – a very sizeable chunk of – personal info, just like that. Personal data is the currency. The battle over ‘who can identify the onlife consumer’ will define the rules of engagement in onlife retail, for years to come. Indiscriminately using the open logins of the social networks or will we shift to using new and (more) secure logins provided by national governments? At the very least, consumers ought to have the right to decide.

Your eID says it all

Now, determining a buyer’s identity is an essential step in the customer journey. For the consumer, the endless retyping of information, during the purchasing process, is seriously annoying. In the future, an eID, or online identity, will be the new normal. The systems behind this might well be game changers in the onlification of society. Several countries, in Scandinavia most notably, have already successfully adopted national eIDs. Banks and governments work together: traveling, paying, voting, or checking your medical records, it can all be done with the same ID.

Biometrics: yes or no?

Identifiers such as fingerprints, facial or vocal recognition or retina scans are not far off, either. Until recently, these things only happened in a James Bond film, but biometric identifiers could soon become mainstream. Mobile banking has used fingerprint technology since 2015, on iOS and Android. Using a selfie (i.e. facial recognition) to pay is in fact available to anyone with a smartphone. Anti-deception measures, to make sure a person is alive, are in place. Voice recognition can provide analysis of vocal patterns, as a means of identification. Behaviour biometrics – such as typing speed or how a touchscreen is used – can also boost security, when used alongside old-school methods. Any day now, we can move from click-and-pay to the no-click pay thanks to a selfie and the blink of an eye. Can you say wink-and-pay? Onlife consumers love the convenience, retailers are thrilled by the reduced risk.

On the downside, there are the risks to privacy and safety. Stored biometric data could be leaked, used for inappropriate or illicit means. Just like other data, it is very interesting for thieves, terrorists or political operatives, all using it for their own gains. To be sure, biometrics are safer than pin numbers or passwords – where consumers are often careless in their use. On the other hand, a consumer would rather lose their pin number than a fingerprint, the latter can never be changed, after all.

About the book

This is blog 39, based on my book ‘The end of online shopping. The future of retail in an always connected world’, published by Business Contact (Dutch/Flemish editions), Nubiz (English edition for UK and US, and Danish editions), WSCP Singapore (English edition for SE Asia), Post & Telecom Publishers Beijing (Chinese edition), Hoepli (Italian edition). Most recently, the book was published in Korean in December 2018 and it is being translated in German, to be published in spring 2019. Additional translations are in preparation for 2019.

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