• silicon.com
• Management
• CIO Insights

By Jo Best, 1 February 2005 16:00

NEWS One supermarket has given its customers the choice of paying by fingerprint at its shop in the state of Washington - and found customers surprisingly willing to give the finger instead of payment at the checkout.

US chain Thriftway introduced the PayByTouch system in its shop in the Seattle area in 2002 and now sees thousands of transactions a month using the payment method.

Once enrolled on the PayByTouch system, users give their fingerprint as verification at the checkout and then chooses which of the credit cards that they've registered with the store they want to pay the bill with.

Thriftway president Paul Kapioski said rather than shying away from the technology due to privacy concerns, customer demand ensured the biometric payment made it past the pilot stage.

The fingerprint payment system was initially scheduled for a 60-day trial but "people were quick to warm up to it... after 60 days, we made it part of our payment package," he told the Retail Fraud Conference in London today.

"We found people came to the store because of this - lots of senior citizens felt more secure not carrying money to the store... The major concern is 'biometric, fingerprint, what's it going to be used for?'... Once [customers] understood what it was used for, it became a non-issue," he said.

Kapioski added that one man even drove 400 miles to use the technology.

Kapioski said the main business driver for the biometrics was cost, allowing the retailer to shave cents off the average cost of an electronic payment transaction. With the biometric system, customers are encouraged to use their debit card - which cost the company almost half as much as the same payment by credit card, for example.

Fraudulent transactions have dropped dramatically due to the system, Kapioski said, which now makes up 30 per cent of Thriftway's electronic payments.

"During the last two, two and a half years... there's not been a single fraudulent transaction on this system," he said.

John Davison, VP and research director at analyst house Gartner, said that customers were generally willing to accept technologies, such as RFID, that could infringe their privacy if the benefits of such technology could be 'sold' to them.

"Will customers object to RFID? Yes, if you don't sell it to them," he said. "Over two-thirds of customers will accept RFID if you sell them the basic utilities."

However, he added that certain areas of retail were still technology sacred. "The nearer you get RFID to the payment process, consumers get less keen. When you start linking... to their personal information, they're even less keen."