The new generation of banking customers would rather use biometric security devices than PINs and passwords for authentication, according to Visa Europe.
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The payments firm found that 75% of 16 to 24-year-olds, or ‘Generation Z’, said they would have no problem using biometric security, with 69% expecting it to be faster and easier than a password or a PIN.
Jonathan Vaux, executive director at Visa Europe, said: “We have more log-ins and passwords than ever to help keep us secure online and on the high street, but for Gen Z it just feels like an unnecessary burden. Biometric authentication using fingerprint recognition or retinal scans offers an ideal solution, combining unique security and ease of use.
“For banks and product providers this means two challenges. First, to continue and quicken the pace of development on biometrics to answer this demand from Generation Z. Second, to continue to evaluate the increasing range of authentication options to ensure customer convenience and security as payment increasingly becomes embedded into a range of applications.”
Nearly 35% of the people in the Generation Z age group said they had shared their PIN number with someone else, compared with only 23% of all those surveyed.
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Younger people often take a more relaxed approach to their personal data, with 32% of those asked saying they use a single password or PIN to protect all their personal data sources.
Over 20% of Generation Z have shared their online banking password with someone else, and 32% have given out their smartphone password.
More than half of 16 to 24-year-olds think passwords will no longer be needed or used by the end of 2020, and will be replaced by authentication methods such as facial recognition or fingerprint and retina scanners.
Of these methods, fingerprint recognition is the most popular, with DNA samples and implanted chips coming in last.
Vaux said the adoption of biometric technology is rising, as it has for mobile banking and payments, as consumers realise the benefits of the authentication.
"The more habitual and commonplace the behaviour becomes, the greater the adoption, particular in the payments landscape. Biometrics will be one of a number of authentication options for consumers to enrol with services, log into their accounts or contribute to authentication at the time of transaction," said Vaux.
"In fact, the uptake of biometric security in the payments landscape is already taking place. For example, in Poland 1,730 cash machines have been equipped with finger vein technology, allowing people to scan their finger to withdraw money from an ATM, with no need for a card or PIN number. Outside of Europe, palm vein technology is being used in the Japanese banking sector to provide advanced security at ATMs."
While young people show less concern than older generations about data protection, a large number believe biometrics will keep their data more secure.
Vaux said: "At present, whenever someone uses a Visa card to make a payment online, multiple layers of protection are already in place, including Verified by Visa and Visa device profiling. These measures help alert and protect our member banks and their customers to potentially risky transactions. Failure at just one layer renders this fraud highly improbable."
Many banks have already begun developing biometric technologies for use in branches or by business clients.
Early last year, Barclays announced plans to use voice biometrics for authenticating customers calling the bank, something it has been using for some customers since 2012.
It later announced plans to launch biometric vein readers developed by Hitachi, known as VeinID.
So how will this technology continue to emerge into the consumer banking space?
Vaux explained: "It will increasingly be used as a component form of authentication within apps provided by banks, operating systems, merchants, handset providers and others. We are already seeing biometric technology being rolled out at different rates and in different regions, such as Poland and Japan.
"There are multiple players who could become involved in creating the technology, depending on the type of biometrics, and also the software and infrastructure needed to support it. Additionally, some banks may have their own R&D facilities, enabling them to create their own solutions."