JPMorgan Chase is targeting early next year to broadly launch a biometric checkout service with its merchants.
The big bank’s payments unit has piloted the service with food service provider Aramark in Texas, and plans to engage in more merchant pilots this year, said Prashant Sharma, executive director of biometrics and identity solutions at JPMorgan, in a recent interview.
New York-based JPMorgan has partnered with software firm PopID on its biometric checkout service. The bank’s payments division began working with the company, which offers face-pay technology, last year, Sharma said.
The JPMorgan payments unit’s biometrics product can be used in e-commerce or in-person checkout scenarios. Consumers complete an initial enrollment process with the bank, through which they take a selfie and enter payment card information. Their information is stored with the bank, and then a customer paying at a merchant using JPMorgan’s service can opt to check out using their biometric information.
JPMorgan has done a proof of concept for both face and palm pay, and the strategy of the bank’s payments unit is to support both, Sharma said. Feedback received during piloting was related to user messaging and user experience during enrollment and checkout, Sharma said.
As the largest merchant acquirer, JPMorgan has relationships with a massive number of merchants, Sharma noted. “We would like every merchant to adopt this, but at the end of the day, it is going to be a merchant’s choice,” he said. The JPMorgan payments unit handled 35.83 billion transactions worth $2.03 trillion in 2022, according to a March 2023 issue of the Nilson Report.
Although the solution will be available to all, there are certain use cases JPMorgan is primarily focused on pitching the service to, Sharma noted. Those include quick-service restaurants, event venues, convenience and grocery stores.
Merchants are highly interested in tapping biometrics, “because everybody wants to provide a streamlined, personalized experience to the consumer,” Sharma said. Incorporating biometrics into checkout also aims to cut down on multiple points of friction, including punching in a phone number for loyalty points, or entering an email address for a digital receipt.
Still, “there is a perceived sensitivity towards biometrics,” Sharma acknowledged. Many consumers don’t realize how often they’re already engaging with the use of biometrics in authentication, including in mobile banking applications or at the airport, he contended.
The bank is working to ensure it complies with all state and federal regulations around biometrics and employs best practices around privacy, consent, transparency and data minimization, he said.
Beyond that, however, “we just don’t see this as a big risk,” Sharma said. “But at the same time, we feel that it is also our job to continue to create that confidence.”
To some extent, that endeavor is aided by the broader rise of biometrics, even when it’s fueled by competitors, such as tech giant Amazon, Sharma said. As merchants and consumers start seeing biometrics use in more places, it’s bound to drive more confidence with consumers, he said.
As the biggest U.S. bank, JPMorgan works “with everybody,” he said, including card network Mastercard, which has rolled out its own biometric authentication service. Prior to working for JPMorgan, Sharma spent 14 years at Mastercard, according to his LinkedIn profile.
“There are certain areas where we will compete, but there are a lot of places where we can collaborate as well,” he said. That includes industry standards, which all parties involved are working on to jump-start use of biometrics. “For anything to scale, there has to be industry standards,” he said.
What the technology will cost merchants, both in expense and counter space, is another key component when considering the addition of biometrics-related products, Sharma said. In some cases, all that’s needed at a counter is a tablet with a camera that can snap a picture of a shopper’s face.
“This is an area that we will continue to invest in, continue to work in,” he said. “It will take a little bit of time, but hopefully we get to a point where there is an all-in-one device that can do card, tap, dip plus biometric data acceptance as well.”
