Post by Watchman on Nov 7, 2005 14:01:18 GMT -5
Biometrics is a technology that enables consumers to pay for products by merely scanning a finger, but some question whether it could make it easier to steal personal information
By Melanie Cleveland
The Tribune
Imagine buying groceries by scanning your index finger. No cash, checks or credit cards required.
It may sound like science fiction, but systems that use biometric technology to identify people using their fingerprints have already debuted in major grocery stores across the country, including Albertsons, Kroger Foods, Lowes Foods and Piggly Wiggly.
It hasn't arrived in San Luis Obispo County. But Pay By Touch Solutions, the company that installed the systems in a pilot program with Albertsons and Piggly Wiggly stores in nine states, says one grocery store giant -- with a large West Coast presence -- will announce a rollout of the technology this month.
The pay-by-finger touch system works by storing a consumer's finger images and personal financial information in a retail outlet's database. Shoppers can tap into that information on a touch pad when they make a purchase. A computer recognizes their finger image, automatically charges their account, and the transaction is complete.
"We are changing the way the world pays," said John Rogers, founder and chief executive officer of San Francisco-based Pay By Touch.
Grocery stores are only the beginning, he said. Rogers hopes that Pay By Touch will be used in more than 10,000 locations -- hotels, gas stations, fast food restaurants, health care facilities and sports stadiums -- by the end of 2006.
"The opportunities," Rogers said, "are boundless."
His company, funded by the Gordon P. Getty Family Trust and other major investment groups, recently received a major cash boost --
$130 million -- to ramp up its development of biometric products and services.
BioPay, which is Pay By Touch's closest competitor, already has 2 million consumers across the United States who use the system to purchase items and to cash payroll checks. That translates to 17 million transactions worth $6.9 billion as of June 2005, said Donita Prakash, vice president of marketing.
Technology in use for years
Biometric technology has been used for years by the military, to identify criminals and control access into high-security facilities. The technology's recent foray into the grocery industry and other retail outlets was prompted by worries about identity theft and heightened security concerns after Sept. 11, 2001.
Service providers and customers worry more about key personal information being stolen and used fraudulently from PIN numbers and ID cards -- so a system that requires nothing but a finger image to access and protect financial information is more convenient and secure, say industry experts.
"There's no question it can help identity fraud," said Albertsons spokeswoman Shannon Bennett. "Only the customer can access this system: It's easier and faster and safer."
Biometrics technology and its associated software have also become more sophisticated and reliable because of recent advances in computer science and trials in the marketplace.
"For instance, algorithms that the system uses to match the minutia in a finger image to a person's financial information in a store database have gotten more efficient," said Walter Hamilton, chairman of the International Biometric Industry Association.
"If a customer has difficulty using the device, a manufacturer will come out with a newer product to answer their concerns," Hamilton said.
The cost of finger scanners has also dropped dramatically -- from a few thousand dollars
10 years ago to $50 today. That's the result of an increase in volume in the industry, Hamilton said.
Jim Burke, vice president of AuthenTec, said his company, which sells its finger sensors to computer, cell phone and access control retail markets, took five years to sell its first million finger sensors. AuthenTec now sell that many every three months.
Not only are more stores using it, more retail and electronics stores, such as Best Buy and Fry's Electronics, are selling it directly to consumers, Hamilton noted.
Finally, merchants want to use a system that saves them money. If finger scan systems can prevent people from using fake IDs, they can prevent loss in cashing payroll checks, biometrics experts say.
Retail stores also save on transaction fees.
Pay By Touch Solutions, for example, charges its stores a flat fee, ranging from 9 to 13 cents per transaction.
"That's very low compared to credit cards, checks or debits, which range -- plus or minus -- at 35 cents a transaction," said Shannon Riordan, a Pay By Touch spokeswoman.
But will U.S. consumers embrace the technology?
The key question is whether customers will accept a finger-scanning system.
"The whole thing is neat, but the benefits of the system are really questionable," said Chris Hoofnagle, senior counsel with the Electronic Privacy Information Center, a public interest research center with offices in San Francisco.
Hoofngle contends that the systems are not worth the security risks and are "not really any faster than cash."
"The systems can be easily fooled," he said. "When most people think of biometric systems, they're thinking of police level, quality equipment. The police have very accurate systems and scanners that cost thousands of dollars and can pick up on nuances of the print."
Some people in San Luis Obispo County are concerned that their personal information will be stolen or abused. Others believe that such technology is invasive.
"What's the matter with a driver's license and a Social Security card?" said Elizabeth Stephenson, a shopper at Ralphs in San Luis Obispo. "What else do they need? I don't like it. It's un-American. That's a problem. If I commit a crime, OK, but shopping is not a crime."
Biometrics-industry advocates, such as Burke and Hamilton, say that worry is misplaced.
"While we are very sensitive to the fear, people need to know, biometrics is designed to protect privacy and deter crime, not violate or abuse it," Burke said.
Hamilton added, "We're not tracking anyone with pay-by- touch systems -- any more than grocery stores do with their loyalty cards. And we've been doing fingerprinting for many service professions, nurses, stock brokers, home-care workers, school bus drivers, members of Congress, policemen -- and they don't consider it an invasion."
Companies like BioPay and Pay By Touch use a template of a fingerprint, which is less invasive because it cannot be reversed into a full fingerprint image, said Raj Nanavati, a partner at the International Biometrics Group, a company that analyzes the biometrics industry.
"That means there is less likelihood that someone could break into the financial information and commit fraud," he said.
Nanavati compared the financial database used by stores with pay-by-touch systems to the information stored by credit card companies.
"These systems will track no more than MasterCard or Visa have done for 20 years," Nanavati said, "and no one has much of a problem with that."
Even so, Nanavati said people should question whether they have the option to be removed from the system.
"Know what you're getting into and have the ability to opt out if you want," he said.
It may be too soon to say how San Luis Obispo County shoppers will react to the technology -- if and when it comes. But biometric proponents hope to win over people like Debbie Hoffman.
"I think that with nothing to hide, it's no big deal," said Hoffman, a Trader Joe's customer. "Fraud and scamming ... costs us all a lot, and it's a pain in the neck to present a driver's license and identification. If you are who you say you are, what's the problem?"
News assistant Jeanne Kinney contributed to this report.
Copyright San Luis Obispo Tribune
The Mark of the Beast is on the fast track!- Watchman Sean
By Melanie Cleveland
The Tribune
Imagine buying groceries by scanning your index finger. No cash, checks or credit cards required.
It may sound like science fiction, but systems that use biometric technology to identify people using their fingerprints have already debuted in major grocery stores across the country, including Albertsons, Kroger Foods, Lowes Foods and Piggly Wiggly.
It hasn't arrived in San Luis Obispo County. But Pay By Touch Solutions, the company that installed the systems in a pilot program with Albertsons and Piggly Wiggly stores in nine states, says one grocery store giant -- with a large West Coast presence -- will announce a rollout of the technology this month.
The pay-by-finger touch system works by storing a consumer's finger images and personal financial information in a retail outlet's database. Shoppers can tap into that information on a touch pad when they make a purchase. A computer recognizes their finger image, automatically charges their account, and the transaction is complete.
"We are changing the way the world pays," said John Rogers, founder and chief executive officer of San Francisco-based Pay By Touch.
Grocery stores are only the beginning, he said. Rogers hopes that Pay By Touch will be used in more than 10,000 locations -- hotels, gas stations, fast food restaurants, health care facilities and sports stadiums -- by the end of 2006.
"The opportunities," Rogers said, "are boundless."
His company, funded by the Gordon P. Getty Family Trust and other major investment groups, recently received a major cash boost --
$130 million -- to ramp up its development of biometric products and services.
BioPay, which is Pay By Touch's closest competitor, already has 2 million consumers across the United States who use the system to purchase items and to cash payroll checks. That translates to 17 million transactions worth $6.9 billion as of June 2005, said Donita Prakash, vice president of marketing.
Technology in use for years
Biometric technology has been used for years by the military, to identify criminals and control access into high-security facilities. The technology's recent foray into the grocery industry and other retail outlets was prompted by worries about identity theft and heightened security concerns after Sept. 11, 2001.
Service providers and customers worry more about key personal information being stolen and used fraudulently from PIN numbers and ID cards -- so a system that requires nothing but a finger image to access and protect financial information is more convenient and secure, say industry experts.
"There's no question it can help identity fraud," said Albertsons spokeswoman Shannon Bennett. "Only the customer can access this system: It's easier and faster and safer."
Biometrics technology and its associated software have also become more sophisticated and reliable because of recent advances in computer science and trials in the marketplace.
"For instance, algorithms that the system uses to match the minutia in a finger image to a person's financial information in a store database have gotten more efficient," said Walter Hamilton, chairman of the International Biometric Industry Association.
"If a customer has difficulty using the device, a manufacturer will come out with a newer product to answer their concerns," Hamilton said.
The cost of finger scanners has also dropped dramatically -- from a few thousand dollars
10 years ago to $50 today. That's the result of an increase in volume in the industry, Hamilton said.
Jim Burke, vice president of AuthenTec, said his company, which sells its finger sensors to computer, cell phone and access control retail markets, took five years to sell its first million finger sensors. AuthenTec now sell that many every three months.
Not only are more stores using it, more retail and electronics stores, such as Best Buy and Fry's Electronics, are selling it directly to consumers, Hamilton noted.
Finally, merchants want to use a system that saves them money. If finger scan systems can prevent people from using fake IDs, they can prevent loss in cashing payroll checks, biometrics experts say.
Retail stores also save on transaction fees.
Pay By Touch Solutions, for example, charges its stores a flat fee, ranging from 9 to 13 cents per transaction.
"That's very low compared to credit cards, checks or debits, which range -- plus or minus -- at 35 cents a transaction," said Shannon Riordan, a Pay By Touch spokeswoman.
But will U.S. consumers embrace the technology?
The key question is whether customers will accept a finger-scanning system.
"The whole thing is neat, but the benefits of the system are really questionable," said Chris Hoofnagle, senior counsel with the Electronic Privacy Information Center, a public interest research center with offices in San Francisco.
Hoofngle contends that the systems are not worth the security risks and are "not really any faster than cash."
"The systems can be easily fooled," he said. "When most people think of biometric systems, they're thinking of police level, quality equipment. The police have very accurate systems and scanners that cost thousands of dollars and can pick up on nuances of the print."
Some people in San Luis Obispo County are concerned that their personal information will be stolen or abused. Others believe that such technology is invasive.
"What's the matter with a driver's license and a Social Security card?" said Elizabeth Stephenson, a shopper at Ralphs in San Luis Obispo. "What else do they need? I don't like it. It's un-American. That's a problem. If I commit a crime, OK, but shopping is not a crime."
Biometrics-industry advocates, such as Burke and Hamilton, say that worry is misplaced.
"While we are very sensitive to the fear, people need to know, biometrics is designed to protect privacy and deter crime, not violate or abuse it," Burke said.
Hamilton added, "We're not tracking anyone with pay-by- touch systems -- any more than grocery stores do with their loyalty cards. And we've been doing fingerprinting for many service professions, nurses, stock brokers, home-care workers, school bus drivers, members of Congress, policemen -- and they don't consider it an invasion."
Companies like BioPay and Pay By Touch use a template of a fingerprint, which is less invasive because it cannot be reversed into a full fingerprint image, said Raj Nanavati, a partner at the International Biometrics Group, a company that analyzes the biometrics industry.
"That means there is less likelihood that someone could break into the financial information and commit fraud," he said.
Nanavati compared the financial database used by stores with pay-by-touch systems to the information stored by credit card companies.
"These systems will track no more than MasterCard or Visa have done for 20 years," Nanavati said, "and no one has much of a problem with that."
Even so, Nanavati said people should question whether they have the option to be removed from the system.
"Know what you're getting into and have the ability to opt out if you want," he said.
It may be too soon to say how San Luis Obispo County shoppers will react to the technology -- if and when it comes. But biometric proponents hope to win over people like Debbie Hoffman.
"I think that with nothing to hide, it's no big deal," said Hoffman, a Trader Joe's customer. "Fraud and scamming ... costs us all a lot, and it's a pain in the neck to present a driver's license and identification. If you are who you say you are, what's the problem?"
News assistant Jeanne Kinney contributed to this report.
Copyright San Luis Obispo Tribune
The Mark of the Beast is on the fast track!- Watchman Sean