Many people use facial recognition technology to unlock their mobile phone or for logging in to certain apps but transacting with your face alone is still uncommon and sparks concerns over mass surveillance in many western markets. It’s increasingly common in China though and is rapidly emerging in Brazil.
“The pandemic has really accelerated the use of contactless transactions,” reported an executive at a Brazilian e-commerce company, “facial recognition payments are part of this and are frequently used in combination with other means of security including voice recognition, QR codes or banking apps. Banks in Latin America have been using facial recognition software to authenticate purchases since 2015, and although facial recognition payments are more advanced it is a natural evolution.”
“Banks in Latin America have been using facial recognition software to authenticate purchases since 2015, and although facial recognition payments are more advanced it is a natural evolution.”
Executive, e-commerce company, Brazil
D’Ville Supermercados, a Brazilian supermarket chain, recently launched a facial recognition payment system in one of its stores in Uberlândia, Minas Gerais. This pioneering system offers a new payment option for customers in a country with the largest retail market in the region.
The e-commerce executive continued, “In Brazil, the first facial recognition payment was launched in 2019 by Banco Senff in Curitiba, Paraná. This was later developed into Payface’s initiative which now is much more solid as it has been developed in partnership with Cielo [Brazil’s largest credit card operator]. The rollout of the initiative has been very carefully designed, starting with small tests in Curitiba through Banco Senff and then pharmacies in Sao Paulo at the beginning of 2021.”
There are multiple advantages associated with facial recognition payments, including quicker – up to nine times – transactions; improved user experience with shorter waiting time; increased payment safety; and opening new consumer opportunities. At a global level, payments authorised by facial recognition are expected to exceed 1.4 billion by 2021 from 671 million in 2020, clearly demonstrating the high acceptance that this new payment method is garnering.
Facial recognition software developers affirm that payments through this system are more secure than using cards and apps. Nonetheless, consumer concerns are mainly related to privacy issues. Technology experts emphasise that, while legitimate, these concerns are not restricted to payments. Instead, they are part of a larger digital identity structure which is already embedded in the day-to-day life of smartphone users.
Security remains a concern for many, as a consumer analyst in Brazil explained, “There is a variety of implementations with varying degrees of security. It is important to differentiate between software-based and hardware-based devices. The latter are clearly more secure. Apple’s Face ID is an example of a secure combination of hardware and software, which uses machine learning with mathematical representation for secure authentication solutions. Other mobile devices use software alone which, basically, is a sophisticated version of a camera. Are all smartphones secure? No. Will all facial payment devices in stores be secure? Probably not. The main security concern is related to data rather than the payments themselves as the banks already have their own security systems in place.”
“The main security concern is related to data rather than the payments themselves as the banks already have their own security systems in place.”
Consumer analyst, Brazil
The main challenges for the expansion of facial recognition payments in Brazil and Latin America are regulatory. For instance, in the US, several local governments have restricted its use considering software programmes too powerful as surveillance tools and too inaccurate in matching face recognition. The e-commerce executive had other concerns, “Security and costs will continue to be the biggest challenges facing new payment technologies like this and more security means more costs. Regulatory hurdles related to privacy will be problematic in more developed markets but I don’t see it being an issue in Brazil.”