The safest means of payment will evolve in 2021. After the dynamic visual cryptogram, card issuers and banks are turning to well-known equipment for smartphones: the biometric fingerprint sensor. BNP Paribas worked with Visa and Thales to develop it. For three months now, she has been distributing the card in all of her agencies.
Why change to a biometric card? The small piece of plastic long promised to be abandoned, in competition with dematerialized mobile payment on our smartphone, will only offer innovation in exchange for an additional cost. It is 24 euros per year at BNP Paribas, reserved for customers eligible for the Visa Premier card (134 euros per year of contribution).
To understand everything, Lemon squeezer spoke with Jean-Marie Dragon, Head of Electronic Banking and Innovative Payments at BNP Paribas. From experimentation to generalization, the man lent himself to the exercise of the interview to present the interests, operation and progress of the biometric card of the French banking group.
Lemon squeezer: The biometric card has arrived in France at BNP Paribas. Concretely, how does it work and what is it used for?
Jean-Marie Dragon: The principle is to replace the confidential code of bank cards with the fingerprint. Thus, customers can pay contactless beyond the ceiling of 50 euros established for all other cards.
COVID has profoundly changed the use of cards by our customers. Today, local sales (face to face in stores) represent 78% of transactions and 69% of the total amount, all cards combined at BNP Paribas. Distance selling represents 22% of transactions in number, and a little more than 30% of the total amount.
If we look at proximity sales, transactions made with the confidential code are of the order of 41%. So almost 60% of card transactions are carried out using contactless payment. The increase in the ceiling and the health crisis have convinced many merchants to accept bank cards from € 1, which has generated very high use.
Lemon squeezer: It therefore seems that the main argument of the biometric card is the absence of the ceiling of € 50 for contactless payment. Isn’t payment security another advantage?
Jean-Marie Dragon: We mainly present the biometric card by emphasizing its ease of use and its freedom from the contactless payment limit. The argument about the risk of fraud with contactless transactions is not entirely relevant, because today we see that contactless payments are absolutely no riskier than traditional contact payments.
Originally, contactless payment was the subject of many doubts. In practice, this is not at all demonstrated. There is no general concern about contactless payment with the fear of having transactions debited without having made them.
Lemon squeezer: Mobile payment is exploding with the health crisis and competes with biometric bank cards. One is free, the other costs 24 euros, subscription where you will have to add Visa contributions (134 euros for a Visa Premier). How much does this card cost to produce compared to a normal card? Does the bank card still have a future?
Jean-Marie Dragon: As we are still at the start-up stage, the cost is not yet representative of the volumes. We started to generalize the card in June, we are still in the deployment phase, our communication campaign is gaining momentum. This is a big investment to be made and we are betting on the success of this card.
Regarding mobile payment, let it explode… yes and no. Its use has grown a lot, especially on Apple Pay, but this only represents 5% of transactions today. This is a lot of course, but after launching it a little over 3 years ago now, we are seeing that the growth in users is steady, but not very significant. Having said that, those who use it, really use it, as a substitute for the card.
What then is the future of the card? Customers will make the choice. What led us to launch the biometric card is that there are customers who are not ready to put their card on their smartphone. There are already a lot of things on our mobile and some want to maintain the border. The biometric card can therefore become a substitute. We are not opposing the two solutions. We seek to leave the choice to the customer.
We often hear that the plastic card is doomed. It is, but we don’t know how soon it will be gone. On the French market, customers are still very attached to the card. We can clearly see the success of contactless and the habit that has been taken. If the card is to disappear, it will take several more years.
We often hear that the plastic card is doomed. She is, but we don’t know how long she will be gone
Lemon Squeezer: How many cards have been dealt since the start? What are your goals for the following months / years?
Jean-Marie Dragon: I can’t give you a number. We got off to a gradual start, with an internal test phase, then with some of our customers… We generalized the deployment to the entire BNP Paribas network in June. The activity really picked up in September. We have launched a communication campaign on television and in the cinema. She boosted sales. Since it started, we have sold twice as many cards.
Lemon squeezer: But your goal, internally, is a symbolic number? Important? Does it represent more than 5% of your customers?
Jean-Marie Dragon: We do not yet have these types of objectives. This is a new product, which is only available on the Visa Premier card. It is not intended for all customers. But depending on demand, we will extend the option to all cards. Today, it is still a little early to take this direction.
We monitor customer usage. For example, to register your fingerprint, you need a measurement with a reader, in a BNP Paribas branch, in order to properly register your fingerprint. The measurement is not as easy as on a smartphone.
The card will be adopted from the moment customers get into the habit and the reflex of going through contactless payment regardless of the amount. The same goes for traders. We have found that several of them are also apprehensive with contactless beyond 50 euros.
We have found that traders are also apprehensive with contactless beyond 50 euros
Lemon squeezer: Unlike a smartphone, a bank card does not have a battery. How does the biometric sensor work? Are there any risks of failure?
Jean-Marie Dragon: There is no risk of failure. For a contactless transaction, an induction is generated by the terminal to the card. It is with this induction that we operate the biometric sensor. It is different on a bank card with dynamic visual cryptogram. These have a battery.
Lemon squeezer: So that means that customers have to put the card on the terminal longer for the induction to be properly generated? Is there a difference with a classic contactless card?
Jean-Marie Dragon: No. It is exactly the same.
Lemon squeezer: Have you encountered any regulatory obstacles for the launch of a biometric card? What about the security and storage of customer biometric data?
Jean-Marie Dragon: There was no regulatory constraint. The product is certified by all the most rigorous payment organizations. BNP Paribas does not release a product which is not certified – which does not meet the standards. Whether they are products marketed on a large scale or in the testing phase. It’s essential.
Biometric data is stored only in the chip of the card. When checking in, we use a small box where the customer must first identify himself, to ensure that the customer is using the correct card in their name. Then, you have to put your thumb several times on the biometric reader, like what you know on a smartphone.
Once that is done, the impression is sealed in the chip, and it will remain in the chip. The fingerprint is scanned, and it does not circulate. There is no sending of the trace of the fingerprint on the networks. Reading the fingerprint only generates a certificate, as is the case for a secret code. This means that there is not a large centralized customer base, with their biometric data, on a server somewhere in the cloud. All individual data remains localized in the chip.
Lemon squeezer: You chose Visa and Thales for this innovation, and you did not offer it for your Hello Bank customers! or for the Nickel Account. Explain your different choices to us.
Jean-Marie Dragon: The choice was made on the fact that we could not open the card to all the customers at once. First, because we are still in the learning phase, it has only been three months since we officially launched the product. Then, because there is an additional cost. As long as we do not have a volume that will allow us to have accessible costs, it will be difficult to generalize it to all of our customers.
Gradually, if the market subscribes to the interest of the biometric card, production costs will decrease and it is clearly in our strategy to open it up to as many people as possible. Today, we have moved from experimentation to generalization. If ever Nickel and Hello bank! have an interest in it, they will clearly benefit from it.
There are a number of things that are launched in advance, whether by Nickel or by Hello bank !, I am thinking of the metal card for example, compared to the traditional BNP Paribas network. Sometimes these products remain specific to these establishments. For example, the metal card is not available at BNP Paribas. It happens that each entity can keep its specificities.
Lemon squeezer: All these questions lead to the question of the typical customer of your new biometric card. What is his profile? Are they individuals? Professionals?
Jean-Marie Dragon: As we have chosen a single product, which is the Visa Premier card, we are necessarily addressing CSP + category customers. Afterwards, we aim to extend the card to all customers if interest is shown. There is no reason that it cannot be offered to professionals and businesses on so-called “commercial” cards. As soon as there is an interest, that it responds to a request, we do not limit ourselves.