Are you curious about what future payments will look like? Then read here and learn more about a trend that you may experience in the near future. At the same time, you can become wiser about what Danish consumers think is important if they are to use biometric payments.
All trend reports on future payment solutions predict that biometric payments will be the form of payment in the future (KPMG, 2019; McKinsey, 2021; Nets, 2021). A biometric payment is a payment in which a person pays with a biometric feature such as his finger or his face. On May 17, 2022, Mastercard announced that they will launch a biometric payment solution system in a number of physical stores in Brazil, where the consumer at checkout will be able to approve their payment by scanning their face or palm instead of swiping their card.
Their goal is that over the next few years, they will launch the payment system worldwide - starting with the United States, the Middle East, Africa, Asia, and Latin America. In addition, Amazon has implemented biometric payment solutions in all their physical stores in the United States. In those stores, it is possible for the customer to pay with his palm on a palm scanner. So, the question is when the technology will hit the Danish market and how will Danish consumers receive such a technology.
Investigation of Danish consumers' acceptance of biometric payments
The fact that biometric payment solutions may be the future of payments in the Danish market led me, Signe Wiese Christensen, and my master thesis partner, Ida Thyregod Nielsen, to examine in our master thesis at Copenhagen Business School, what attitudes Danish consumers have and how these affect the acceptance and use of biometric payment solutions.
Just as Mastercard has learned that consumers are crazy about biometrics, we learned in our thesis that Danish consumers are generally very open and enthusiastic about biometric payments and that a future rollout of biometric payment solutions in Denmark will therefore probably be successful. At the same time, our study shows that Danish consumers are not worried about sharing biometric features, such as their face or fingerprints. This means that a possible concern about sharing sensitive personal information will not deter Danish consumers from using biometric payment solutions.
Important factors for the acceptance of biometric payment solutions
1. Trust
Trust is important for Danish consumers. None of the consumers expressed that they would pay with a payment solution they basically do not trust. Trust here is twofold: for the Danish consumers, it is important that there is trust in the company behind the biometric payment solution, as well as that they must have confidence in the technology if they want to use/accept the solution.
2. Security
Security is also important because high security is essential for consumers to use biometric payment solutions. Biometric payment solutions are perceived as slightly less secure - or at least with more unanswered questions about security - than the traditional payment solutions.
3. Convenience
It is important for the investigated/surveyed Danish consumers that biometric payment solutions are easy to use. Consumers will in a greater extent consider using a biometric payment solution if it is easy and if the payment solution is fast. Here it is important that biometric payments are not cumbersome and that they are at least as fast as the existing payment solutions, such as the contactless payments if they want to use the solution. The fact that the payment must be easy and fast must not only be when the consumer pays down in the store, but also in the actual registration process/onboarding process of the biometric payment solution.
However, most Danish consumers have a positive perception of biometric payments, as they are perceived as convenient because you as a customer do not have to remember your card and can only pay with your face or finger.
4. Hygiene
After Covid-19, new concerns about hygiene have caused Danish consumers to change their behavior, and in continuation of this also their preferences for payment solutions. In general, consumers prefer hygienic, contactless payment solutions, and in this respect, a contactless biometric payment solution is advantageous.
5. Innovation ability/Innovativeness
Innovation ability/Innovativeness is one's ability to adopt a new technology before everyone else. How high one's innovation ability is also has an effect on how open one is to using biometric payments. This is seen by the fact that the ability to innovate seems to influence a person's general attitude towards biometric payment solutions. If you have a high ability to innovate, you will typically be more willing to try out new technology when it is launched. If, on the other hand, you have a low ability to innovate, you will have greater resistance to biometric payments and technology in general. In continuation of this, there is a certain correlation between the level of the ability to innovate and than age. The younger consumers will generally be more open to new technology and biometric payment solutions than the older generation.
6. Social Influence
The majority of Danish consumers believe that their circle of friends or family has an influence on which payment solution they use. This is especially true of mobile and social payment solutions, such as MobilePay, WeShare and wallets. Therefore, one's circle of friends or family can also have an influence on the Danish consumers' use of biometric payments.
The future of biometric payments
Biometric payment solutions will probably be a payment solution we will see in Danish stores in the future, the question is just when.
Danish consumers are generally very open and enthusiastic about biometric payments and a future rollout of biometric payment solutions will probably become successful if consumers have trust in the solution, are confident in using it and that it is easy to sign up and use the biometric payment solution.
Corona has given the contactless payments a boost and if the biometric payments can work with a scan without touch, it may make more people want to make use of them. In addition, if the biometric payments can be taken up by the more innovative consumers who are curious about new technology, it can also give the solution an advantage.
It will be exciting to follow the development and how Danish consumers and businesses will receive the biometric payments.