09/03/2024 | News release | Distributed by Public on 09/03/2024 09:27
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Pricing and Sourcing Pressures Have Been Weathered So Far |
NEWS |
The last few years have provided no small degree of uncertainty for the payment card market as a whole, with the chipset shortage applying strong allocation and pricing pressure, and the overstocking phenomenon, which ABI Research expects to be realized in Full Year (FY) 2024 issuance volumes. As a subsegment of this market, and inclusive of its own market inhibitors, the biometric payment card market has faced considerable struggles in landing new projects and seeing existing pilots move to the commercial launch stage.
Indeed, with the chipset shortage and general price increases in components, labor, and logistics driven by inflationary pressures, the biometric payment card market has faced a restriction in the immediate availability of biometric sensors to be integrated, as well as market lead times, which, in the standard payment card Integrated Circuit (IC) market, increased from 6 months to nearly 18 months. However, despite these pressures, the market is still seeing new projects launching and continued development from key market vendors in the space of enrollment and pricing strategies to continue the upward trend in the biometric payment card market.
New Market Activity for the Biometric Card Market |
IMPACT |
In 2024, despite myriad obfuscations and market pressures, there have been a number of developments through 1Q and 2Q to suggest that the biometric card market continues to see innovation and new tenders launching, which will serve to invigorate further interest in the wide variety of use cases and opportunities that a biometric card can bring to vendors, banks, and customers:
It is clear that the biometric card market, while struggling to gain significant traction in some contactless mature markets, has now clearly broken ground in emerging areas such as Asia-Pacific and Latin America, where digital-driven banking ecosystems have led to a growing demand for market-leading next-generation smart card technologies, including biometric integration.
Both Payments and Access Control See Biometric Card Interest Grow |
RECOMMENDATIONS |
Of course, the biometric card market is not limited to the realm of payments, with access control very much a driving market for biometric card players, with access control and payments having a clear synergy, leveraging contactless to perform the function of the card, whether it be for entry to a location or a transaction.
This has been supported by recent developments such as the August 2024 announcement by Smart Biometric Technology, which unveiled its multi-function Digital ID, Doorway Access and PC log-on multifunction card inclusive of a nano fingerprint sensor for card user validation and activating the card's security functions.
Similarly, Zwipe shifted a considerable amount of focus from payment to access control as it relates to biometric cards, and has joined forces with SCAP, a France-based access control card and reader distributor, to offer Zwipe's biometric ID card technology to the French market. Zwipe seeks to leverage this partnership with SCAP to widen the opportunity of growing a customer base spanning the French security sector. This involves a wide-ranging industry, including logical and physical access system manufacturers and installers/integrators in peripherally-connected industries such as travel, healthcare, and critical infrastructure.
While the access control market poses a great opportunity for the biometric card, the key inhibitor for rapid uptake is that, while Europay, Mastercard, Visa (EMV) within the payments industry oversees standards across the physical card and related Point of Sale (POS) infrastructure, the access control market is still heavily fragmented and does not retain the privilege of globally recognized standards. This will need to be considered, given that many biometric card solutions are reliant on power harvesting from the reader, which cannot be guaranteed as an option in a reader market that caters to a variety of power and interoperability requirements.