Why financial institutions can’t afford to ignore biometrics anymore

Key takeaways
Traditional authentication is no longer enough
Why fraud teams need more than just stronger passwords
Biometrics are more than just fingerprints
Fraud prevention without friction
Biometrics and the trust equation
What mid-tier banks can do
Biometrics provide security that recognizes the real you
Ready to rethink fraud prevention?

Key takeaways

Traditional authentication methods are no longer sufficient: Passwords and device-based verification are vulnerable to modern fraud tactics, including social engineering, credential stuffing, SIM swaps, and malware. Financial institutions need to upgrade their security measures to keep pace with evolving threats.
Biometrics offer a critical layer of security: Biometrics are not just an optional feature; they are now essential for effective fraud prevention. They serve as a foundation for building digital trust by enabling more accurate and robust user verification.
Biometrics go beyond fingerprints: Modern biometric authentication includes facial and voice recognition, as well as behavioral biometrics, which analyze how users interact with their devices. Behavioral biometrics enable continuous authentication, preventing unauthorized access throughout an entire session.
Biometrics reduce friction and improve customer experience: Contrary to concerns about user inconvenience, biometrics are actually preferred by most consumers for their ease and familiarity. Deploying behavioral biometrics can improve fraud detection rates, reduce false positives, and lower authentication costs, all without negatively impacting customers.
Investing in biometrics fosters customer trust and business growth: Effective fraud prevention with biometrics not only protects users but also builds brand trust, leading to higher customer retention and potential revenue growth. Mid-tier banks can start integrating biometrics in online, mobile, and call center channels even with modest budgets.

Biometrics are needed as traditional authentication is no longer enough

Imagine guarding your house with a cardboard door. Sure, it looks like security from the outside, but give it a gentle push and it folds. We won’t even talk about how it would handle during some rain, either. Unfortunately, the cardboard door analogy provides an image of how traditional passwords are performing against today’s sophisticated fraud tactics. For mid-tier North American financial institutions, the threat landscape is evolving fast, and it’s time for fraud strategies to improve and authentication to catch up. How? By using biometrics.

Why fraud teams need more than just stronger passwords

Watch any Hollywood heist film from the nineties and you’ll see criminals hacking passwords. They may even have a fancy gadget that connects to a bank vault’s number pad and unscrambles the passcode in seconds. Thankfully, none of this is happening today. Fraudsters are not guessing passwords.

Unfortunately, they’ve gone one better. They’re exploiting large-scale data credentials using social engineering and deploying bots that mimic human behaviour. [1][2] Passwords and one-time passcodes are no longer enough. Even device-based verification is vulnerable to SIM swaps and malware. Indeed, the Deloitte Center for Financial Services expects synthetic identity fraud to generate at least US$23 billion in losses by 2030. [3] But there is a way to stop the criminals in their tracks: behavioral intelligence and biometrics.

Biometrics are not just a shiny add-on for financial institutions to consider. They are a critical layer in today’s fraud prevention strategy and a foundation for building digital trust.

Biometrics are more than just fingerprints

Let’s clear up a common misconception. By ‘biometrics’, we’re not just talking about using a fingerprint to unlock an app. Today’s biometric authentication goes much further and includes:

Facial recognition that confirms you are physically present

Voice recognition that can detect tone, cadence, and stress

Behavioral biometrics that analyze how a user swipes, types, and holds their device

This last category – behavioral biometrics – is particularly powerful for fraud teams. It enables continuous authentication, not just a checkpoint at login. It lets your systems ask whether the user is still the same at every step of the session. Again, think back to a Hollywood film where a criminal gains access to someone’s phone or banking app with a thumbprint. With behavioral intelligence and biometrics, the fraudster wouldn’t get much further than the homepage, being locked out long before attempting to complete a transaction.

Fraud prevention without friction

Many banks and credit unions fear that introducing new authentication methods will alienate users. The reality is the opposite. Research shows that over 70 percent of consumers would rather use biometrics than remember another password. Why? Because it’s easy, frictionless, and familiar.

And it works.

According to Threatmark, an industry leader in the area, real-world deployments of behavioral biometrics have seen a 70% better detection rate than fraud detection software, 90% fewer false positives, and a 90% decrease in costs of authentication. [4] This is all without negatively impacting the customer experience. Instead of putting up more walls, banks can now build smarter doors.

Biometrics and the trust equation

Fraud prevention is not just about stopping bad actors. It’s about earning and keeping customer trust. When users know their financial institution is using advanced tools to protect them, and doing it seamlessly, they stay. And they recommend.

McKinsey puts it simply: organizations investing in digital trust can unlock up to 10% annual revenue growth. [5] Biometrics are no longer a nice to have but the frontline of that trust.

What mid-tier banks can do

Thankfully, you don’t need a huge budget to start using biometrics effectively in banking. It’s probably best for most banks to begin with:

Layering behavioral biometrics into online and mobile sessions

Mobile app integration for fingerprint or facial recognition

Exploring voice authentication for high-risk or high-friction call center interactions

Educating users that this is about protecting them, not just you

Fraudsters are already moving beyond credentials and your defenses should too.

Biometrics provide security that recognizes the real you

Think of biometrics like subconscious knowledge. When you meet up with a friend, you don’t ask to see their ID or hear a password. You know them and they know you, even though you might not have met up in a while. Scents, movements, accents. All add up to creating the person in front of you. And because you know your friend so well, you also know instantly when something is off. That’s the power of biometrics. It picks up on the subtle, unique patterns that make someone who they are. And just as importantly, who they’re not.

That’s the kind of instinctive recognition that fraud prevention needs today. Authentication that doesn’t just check a box but truly knows the user. It’s time to get on board.

Ready to rethink fraud prevention?

We’d love to show you what smarter, adaptive fraud prevention looks like.

Get in touch to learn more about NetReveal Payment Fraud and our full financial crime prevention suite of products including AI agents, AI overlays and the award-winning Sensa Investigation Hub case management system.