India was chosen as the first country to experience the benefits of the new Mastercard Payment Passkey Service to facilitate payment authorisation and make online shopping more secure.
Mastercard announced the launch of its new worldwide service at Global Fintech Fest in Mumbai on Aug. 29. Payment Passkey Service will be piloted by India’s largest payment players, including Juspay, Razorpay and PayU, online merchants such as bigbasket and leading banks such as Axis Bank.
The new tool uses device-based biometric authentication methods such as fingerprints or facial scans to streamline online checkouts. This innovative payment authorisation means aims to replace traditional passwords and OTPs. The latter are increasingly vulnerable to phishing, SIM swapping and message interception scams. Therefore, they do not add much to the security of online transactions.
In India, for example, the number of fraud cases has surged by nearly 300% in the last two years, per the Reserve Bank of India’s Annual Report for 2023-2024. Over 9 lakh incidents of phishing, vishing, and credential/OTP compromise led to a loss of nearly Rs 1500 crore between April 1, 2020, and 31 March 2022.
This is why Mastercard proposes another solution – payment passkeys. They are powered by tokenization technology which secures a consumer’s payment details and biometric data. The passkeys work the following way:
- shoppers choose Mastercard while checkout,
- they can use biometric authentication features available on their device (fingerprint, face scan or PIN) to confirm the transaction.
India is an excellent choice to test the new technology in practical settings, with its rapidly expanding payment ecosystem and advanced tokenization market. Upon the initial pilot program in the country, Mastercard plans to roll out the new service to more consumers and financial institutions around the world.
“Through innovative technology that enhances security and convenience, we’re creating a more transparent commerce ecosystem for all. As we continue to lead the way in digital payments, our commitment to achieving a tokenized future is stronger than ever.”
Jorn Lambert, chief product officer at Mastercard
Mastercard has been working on the new biometric authentication technology since at least January when the service was briefly presented. As it complies with Fast Identity Online (FIDO) standards, the new tool can potentially be available to billions of devices worldwide.
