Fingerprint payments taking off despite security concerns

Consumers embarking on a shopping spree may be able to leave their wallets behind in the near future, despite some security and privacy experts' concerns. This week, Pay By Touch Solutions, a San Francisco-based firm whose system allows customers to pay at participating grocery stores with the press of a finger, announced that investors have pledged $130m to fund the company's expansion plans. And, rival BioPay has already enrolled more than two million people into its service for cashing payroll checks and paying at the supermarket checkout.

Paying by fingerprint is a hit with consumers, because people want convenience and faster check outs, said Shannon Reardon, director of marketing for Pay By Touch. "The primary reason consumers sign up is for convenience," Reardon said. "They don't need a wallet or purse. When it become more ubiquitous, consumers won't have to carry cards around."

Moreover, the systems are popular with merchants, who stand to save a significant amount in processing fees if their customers pay using fingerprints linked to their bank accounts - up to 75 per cent over straight credit card fees, according to BioPay. The market for such point-of-sale equipment and services will jump to $440m - or 8.4 per cent of the market for biometrics - by 2010, up from $31m - or two per cent of the market - in 2005, according to research firm International Biometric Group.