Passwords to become passé as more firms back biometrics

Transamerica introduces first voice recognition technology to authenticate customers

May 2, 2017 @ 5:01 pm

By Liz Skinner

Financial advisers and their clients increasingly will find they need to keep fewer passwords top of mind as new technologies move financial services firms to safer forms of identity authorization, such as biometrics.

"There's a big wave in no-password access to information," said Mukesh Mehta, chief information officer at AssetMark. "Whether it's biometric-based or newer technologies like bar codes that we scan from our mobile devices, they allow you to really take away the whole notion of passwords, which are one of the weak points in cybersecurity."

Some firms will aim the technologies at advisers, giving them safer access to firm information and client data. Others will focus on putting the tools in clients' hands. Experts expect that once these systems prove to be easier and more secure, they'll become the norm.

Transamerica took a step in that direction Monday, announcing that its customer call center is the first in the nation to begin using voice biometrics authentication technology from Nuance Communications combined with natural language tools to identify clients through the sound of their voice when they call in and say, "At Transamerica, my voice is my password."

(More: Most advisers' cybersecurity training insufficient)

Voice Pass verifies the caller's voice against his or her unique "voiceprint" on file. The tool is expected to reduce fraud and be 80% faster to authenticate than passwords, security questions or entering unique PINs, according to the life insurance and retirement provider. About 10 million people use the firm's call center every year.

The problem with passwords is they can be hacked, people forget them and, often, people just don't choose good ones, such as using the year of their birth, said Gerard Rescigno, chief technology officer of Transamerica.

"Part of this move is convenience: We want customers to be able to interact with us better and transact using simple English," he said. "It's also for enhanced security, you can't duplicate or mimic someone's voice."

Even if a caller is sick and their voice sounds different to them, the combined biometrics and natural language understanding system won't be fooled or confused, he said.

Transamerica said it's the first to roll out this technology to customers.

Another example of enhanced authentication will come from Edward Jones later this month, when it implements a system to allow clients to log into their portals and accounts using their thumbprint on mobile devices.

"Clients see what happens in the consumer space and they expect these same things to be implemented by their financial services firms," said Vinny Ferrari, chief information officer of Edward Jones. "The expectations have risen dramatically."

The firm, which says it has about15,000 financial advisers, will be implementing a touch ID system for advisers next, he said.

(More: Advisers using tech tools to attract millennials)

Of course many financial services companies, and those that provide them with technology, are waiting until biometrics are more widely adopted across devices.

David Lyon, chief executive of Oranj, said his fintech firm is evaluating biometric technologies "and really likes where they are going."

The firm will likely move toward integrating such authentication tools once it's clear whether the rumors are true that iPhone 8 is going to have either an iris scanner or facial recognition, he said.

About 85% of the advisers and end clients who use Oranj's digital advice platform are iPhone users, he said.

"We follow very closely what devices our users use," Mr. Lyon said.

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