The global biometric payment cards market size was valued at USD 74.4 million in 2021. It is projected to reach USD 5,878.32 million by 2030, growing at a CAGR of 62.50% during the forecast period (2022–2030). Biometric payment cards are a type of identification that analyses and recognizes people based on physical and behavioral characteristics. Fingerprints, retinal scanning, iris scanning, facial patterns, voice recognition, and body movement are among them. Biometric cards also contain smart cards with various security features, such as an optical stripe or barcode, a holographic security image, and an embedded chip. The biometric sensors in these cards provide the user with the most secure payment method, propelling the market forward. Furthermore, the contactless payment method is gradually gaining popularity, improving security and reducing payment processing time. In the financial services industry, biometric technology is gaining traction as a secure and convenient alternative to passwords and PINs. This technology is increasingly being seen as having the potential to make consumers' lives easier to manage by giving them more options for confirming their identity.
Another significant advantage of biometric payment is that it eliminates the limit or cap on contactless payment transactions. Users' fingerprints are securely authenticated, and they can enjoy the convenience of contactless payment for any amount. The biometric sensor captures fingerprint data securely stored in the card's secure chip. Furthermore, this information is neither stored on the bank's servers nor transmitted over the internet to a personalization bureau. As a result, fingerprint payments' success depends on a rigorous and privacy-friendly enrolment process. Additionally, these cards can be used with a PIN code as a fallback solution when the cardholder's fingerprint is unavailable, such as when withdrawing cash from an ATM.
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Enhanced Security and Identification System
The consistent demand for an improved security and identification system during payment processes or transactions has led to an expansion in the adoption of biometric payment systems. The biometric payment security and identification system comprise hardware, software, and services. Therefore, a contributing factor to the growing adoption of biometric payment systems is the general increase in the use of biometric systems for various applications, including entry systems and payment processes, as well as the benefits, such as seamless operation and improved end-user experience, etc.
Increased internet penetration, smart device adoption, mobile transaction volume, and digitalization are seen worldwide, particularly in developed and developing countries, which has resulted in a shift in payment mode. As a result, the adoption of digital payment methods such as biometric payments is increasing with the transition and affinity for online or digital payments. The increased security provided by biometric payment terminals is another factor driving their demand. The growing use of biometric payment terminals in the BFSI industry vertical is the most effective application of the technology, contributing the most to the global biometric payment market.
Cashless Transaction and Low Awareness
Further technological developments have led to the introduction of stores with cashless payments, which is anticipated to present a significant obstacle to expanding and adopting biometric payment systems. The high cost associated with the biometric payment terminal system and the lack of awareness among various underdeveloped countries is both factors restraining the growth of the biometric payments market in terms of value.
Advancements in Biometric Technology
Biometric payment systems are point-of-sale (POS) technology that uses biometric authentication to allow a transaction or payment to occur. In addition to fingerprint biometric authentication technology, advances in biometric technology have introduced advanced biometric authentication technologies such as eye recognition, etc. On the other hand, biometric payments enabled by fingerprint authentication technology are the most widely adopted due to the ease of use and relatively lower cost associated with fingerprint identification systems. Technology has advanced to the point where a single biometric payment terminal can now support multiple identification methods, such as fingerprint, iris, palm, and others.
The global biometric payment cards market is segmented into card type and end-use.
Based on card type, the market is divided into credit cards and debit cards.
The debit cards segment dominates the market, accounting for the majority of revenue during the forecast period. Companies involved in the biometric payment card market are testing debit cards with fingerprint sensors as part of a pilot program. Furthermore, most of these market participants have completed debit card pilots. The credit card segment is expected to experience the highest growth rate during the forecast period. Growth in the segment is anticipated to be driven by people's rising credit card usage. This adoption results from various factors, such as getting cash back, discounts, and using the bank's leverage.
Based on end-user, the market is categorized into retail, transportation, healthcare, hospitality, and government.
The retail sector dominated the market and generated the highest revenue share. The retail sector is expected to experience the highest growth rate during the forecast period. The retail market has already adopted NFC technology, QR codes, and voice payment methods, creating segment growth opportunities. Additionally, retailers are increasingly adopting digital and contactless payment card methods. The hospitality sector is anticipated to experience substantial growth over the forecast period. Restaurants and hotels are now equipped with biometric digital payment systems that allow customers to pay with fingerprint scanners.
The global biometric payment cards market is regionally segmented into North America, Europe, Asia-Pacific, and LAMEA.
Regional Growth Insights Request Sample Pages
North America dominated the market for biometric payment cards and generated the most revenue. The regional market expansion can be attributed to the presence of numerous market participants. In North America, the increased use of contactless cards as a payment method is anticipated to generate market expansion opportunities. Asia-Pacific is home to some market leaders, including Goldpac Fintech. In addition, market participants are planning to launch biometric payment cards in Asia-Pacific countries.