Pay With Your Face: Is the End of Cash Nigh?

Is it time to stop worrying about the war on cash and begin paying with your face? Over the past decade, the movement toward a cashless society has been gaining steam. In a climate hyping all things artificial intelligence, this world could be coming close to being realized.

The End of Cash?

In March, JPMorgan Chase announced that it signed an agreement with PopID to help create a biometric payment system in 2025 by using its commercial identification infrastructure. Many US retailers have experimented with this technology, using face authentication, fingerprints, and palms. Some big brands have been utilizing these tools for a while: Amazon maintains a pay-by-palm mechanism at its brick-and-mortar locations, while Apple Pay allows users to pay with a face scan.

But while many cashless proponents argue for simplifying transactions, the newest narrative is to prevent fraud and secure your identity. PayPal is perfecting a native biometric payments system to stop odious actors in their tracks. Google Play recently established a biometric accessibility feature. Mastercard and Visa have turned bullish on biometrics for security purposes.

“Our focus on biometrics as a secure way to verify identity, replacing the password with the person, is at the heart of our efforts in this area,” a Mastercard spokesperson told CNBC. The payments provider launched pilot programs in 2022 that allowed shoppers to pay with their palms or faces without tapping, swiping, or inserting credit cards.

For these companies, the marketing scheme is to make secure cashless payments convenient and straightforward. The business news network, reporting on the JPMorgan-PopID partnership, informed readers that “PopID simplifies this process by requiring just tapping an on-screen button, and then looking briefly at a camera for both loyalty check-in and payment.”

Hooray for Biometrics

A 2023 study by PYMENTS revealed that consumers, especially the younger demographics, are content with biometric technology. The survey confirmed that one-quarter of Generation Z preferred facial recognition as an authentication method to validate online purchases. Nearly a fifth (19%) of millennials also desired face scans more than other options, such as passwords or fingerprint probes.

Recent research from International Data Corporation, a global market intelligence firm, confirmed that consumer acceptance of biometrics is garnering traction. More than three-quarters (77%) of survey participants who use biometrics on their mobile devices are satisfied with the authentication tool. The main reason is that they are frustrated over remembering multiple usernames and passwords.

North of the border, a February 2023 Payments Canada poll discovered that nearly half (45%) of Canadians were interested in using biometric payments. Of course, the support was concentrated among consumers aged 18 to 34.

Canceling Cash?

Is the war on cash close to the finish line? The technology to ditch physical pieces of paper backed by nothing has accelerated. In the coming years, the tech will be perfected. But is there an appetite to completely wave goodbye to images of George Washington and Abraham Lincoln?

Although the numbers are mixed, one report suggested that cash is still, surprisingly, king. Earlier this year, data from a YouGov Profiles study confirmed that 67% of Americans still use the traditional in-store payment. However, in 2022, 41% of Americans said cash is used for “none of their purchases,” the Pew Research Center reported.

The Federal Reserve Bank of Boston says the consensus is that, while cash usage has been on the decline, it is not going away altogether. “In 2022, there were a staggering 70 billion cash transactions, making it the third-most-common payment method,” the regional central bank said late last year. At the same time, cash payments might be leveling off and may be “at its floor,” the Boston Fed added.

 

 

 

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