In light of recent security breaches at high profile financial institutions, many credit unions are reconsidering biometrics as a better way to authenticate both members and employees. Biometrics covers a range of security methods that use people’s physical characteristics for authentication purposes.
Although some credit unions adopted biometric methods in the late nineties, it is just now gaining widespread consideration due to falling implementation costs and numerous improvements in the reliability and accuracy of the results. Today, dozens of leading credit unions are using biometric solutions not only to solve security concerns, but also to increase service offerings to members.
Credit unions are using biometric methods internally for employee authentication, and in branches or remotely (at smart ATMs or kiosks), for member authentication. Here is a credit union example for each.
Passwords, the most common form of authentication, are a catch-22. Some employees choose simple passwords that are easy to remember but unfortunately are also easily compromised. Very complex passwords are more likely to be forgotten, leading to lost productivity in the IT department. According to the Gartner Group password resets account for about one in four IT help desk requests.
After discovering that an astounding 80% of their employee passwords were easily broken, Telesis Community Credit Union ($487M, Chatsworth, CA) implemented a biometric solution that just requires employees to use a fingerprint scanner to access the network. This resolved the problem with weak passwords by getting rid of them completely, as well as making it quicker and easier for employees gain network access.
To eliminate the risk of impersonators gaining unauthorized access to their members’ safe deposit boxes, Eastern Financial Florida Credit Union ($1.8B Miramar, FL) adopted a hand-scanning technology. In addition to the security benefits, the technology also improves member service by reducing the time it takes for members to access their safe deposit boxes and improves productivity by reducing the number of employees needed to monitor the secure areas.
Other credit unions are adopting fingerprint scanning solutions at their teller windows to combat fraud. This not only prevents someone from impersonating the user but also makes members feel more secure.
Some credit unions are leveraging biometric-enabled kiosks to provide services to members with fewer branch employees or in places where they are unable to build a branch. South Metro Federal Credit Union ($43.2M Prior Lake, MN) includes “Teller Online Machines," referred to as TOM, with fingerprint verification in some of their branches.
TOM provides members with the ability to perform almost all transactions that usually require a live teller, as well as check their account balance, apply for loans, and open an account. According to the SMFCU website, “Members can do most anything at TOM that you could do with a live teller because the biometrics (the fingerprint verification) performs the positive identification step.”