Digital IDs and biometrics promise the future of transaction security

The intertwined future of digital identity and biometrics is already beginning to transform payments.

As digital wallets gain traction, the security the features that determine their use emerge as components that shape the future of commerce and authentication.

With the European Union eIDAS2.0 (electronic identification, authentication and trust services) As the 2026 regulatory compliance deadline approaches, using the intersection of digital identification and biometrics to deliver enhanced security, enhanced user experience and better Fraud prevention is a priority for the payments industry.

MasterCard announced Thursday June 6 its first biometric payment program in Europe, a face and iris payment pilot in Poland that the company described as “buy with your eyes, pay with your gaze.”

Biometric authentication relies on unique biological characteristics – such as fingerprints, palm veins, facial recognition or iris scans – and provides a high level of security by ensuring that only the rightful owner of a biometric signature can access certain services or authorize transactions.

When combined with digital IDs, which provide a secure and verifiable way to identify individuals online, the security of biometrics is further enhanced. Observers say the integration of biometric authentication and digital IDs could lead to a fundamental overhaul of how authentication and transaction security are approached and ultimately help unlock the potential of the next generation of the digital and connected economy.

Read also: Visa is reshaping the digital wallet landscape at the intersection of identity and payments

The interdependent future of biometric payments and digital IDs

Digital IDs simplify identity verification in various services, including banking, government services and travel. Users no longer need to carry multiple forms of identification; a single digital ID in a digital wallet may be enough. When this digital identification is linked to biometric data, the verification process becomes even more transparent and efficient, allowing users to access services with minimal friction.

That is at least the aim of the eIDAS 2.0 regulation, designed to streamline and secure electronic transactions in EU member states by ensuring that things like digital signatures and digital identities are recognized across borders , thereby making digital activities and cross-border transactions more transparent. .

The PYMNTS Intelligence report «Digital bill payments: Mobile wallets gaining popularity, but obstacles remain» showed that 60% of consumers used mobile wallets to pay their bills in 2023, an increase of 22% from the previous year.

“With the world we live in, digital identities are increasingly used than physical driving licenses or physical passports,” ACI around the world Vice President of Global Fraud Risk Prevention Services Erika Dietrich told PYMNTS in September.

Nonetheless, for biometric digital identifiers – and the wallets in which they exist – to achieve widespread acceptance, complex standards must be orchestrated to ensure interoperability and trust.

“Biometric Authentication, while it exists for other aspects of our lives, is not a huge thing at this point for payments – but as far as payments are concerned, it’s the future,” Marc Hopkinsvice president of E-Complishtold PYMNTS in May.

See also: How Solving Digital Identity Acceptance Could Transform Digital Payments

Unlock authentication opportunity

Fraud prevention is a concern in today’s digital world, and the combination of digital IDs and biometric payments offer a solution. Since biometrics are unique to each individual, they provide a high level of assurance that the person making a transaction or accessing a service is the rightful owner of the identity.

“The world needs to move away from a risk-based approach. authentication (RBA), which is probabilistic, and adopt a deterministic approach based on keys linked to identities”, Prove identity CEO Rodger Desai told PYMNTS in May.

“The key is to authenticate the identifier securely,” Desai added, emphasizing the importance of careful management of biometric data due to its non-revocable nature.

Digital IDs linked to biometric authentication make it difficult for fraudsters to use stolen credentials. Real-time identity verification ensures that fraudulent transactions are identified and blocked, reducing the risk of financial loss. This fraud prevention capability is particularly valuable in the financial sector, where identity theft and unauthorized transactions are problems.

Particularly in a landscape where payment mechanisms have never been more optional, requiring a fundamental rethinking of how to best approach The authentication and security of transactions implied by new payment methods are important for stakeholders across the entire payments ecosystem.

“Create a coherent journey while protect the customer» is crucial, Entrance director of technology Gerhard Oosthuizen told PYMNTS in May. “There is no longer an excuse for poor user journeys. …If I had a bad payment experience with a certain railroad or payment method, I won’t use it.

By integrating digital identity into payment authenticationOrganizations can streamline processes and improve security by verifying the right person and intent behind transactions.

“Blending Payments with Digital Identity; I think that’s where there will be real innovation,” Oosthuizen said.