Continuous developments in technology coupled with the spread of COVID-19 caused numerous changes among industries, including the financial sector. This industry is known to be reliant on in-person processes, but due to the health protocols amid the pandemic, most face-to-face transactions have to be limited and must be done online. This new standard challenges banks and financial technology firms to ensure a safe and secure online transaction for their customers.
For years, financial industry systems have been reliant on passwords, which are among the oldest and most common authentication methods. Although this identity verification system has provided some help in keeping accounts and important data from unauthorized persons, passwords were proven to be a weak barrier against cybersecurity threats. The fast-paced change in the digital industry has also contributed to making this authentication method more susceptible to cyber threats. Therefore, banks must step up their security and privacy defenses while providing a hassle-free experience for their customers.
Progressively, the digital industry has developed new ways to support and make passwords more adequate, like the adoption of a multi-factor authentication solution. This identity verification for mobile banking and other apps requires the user to present two or more pieces of evidence for authentication. Some examples of MFA are passwords plus email or SMS text. However, scammers and hackers are still able to breach this identity verification method. Because of these online threats, several advancements, such as FIDO2 authentication, were launched.
FIDO2 is a more robust authentication that requires a user to use stronger identity verification combinations such as biometrics and cryptographic keys. These verification methods are possible with the updated iOS and Android mobile devices as they have built-in systems suitable for facial and fingerprint recognition.
These new improvements in the digital world made passwordless login attainable. To know more about it and its advantages, read this infographic from authID