Point of sale (POS) system is playing an important role in retail industry by helping business avoid manual errors, better manage inventory, customers, merchandising and marketing campaign. With the advancing technology developments that enable POS system to be more secured and convenient, the demand and adoption of POS is expected to witness a significant growth in the coming time. It’s estimated that POS market size in 2016 was USD 47.95 billion and will continue to grow fast at CARG 9.9% at USD 116.06 billion by 2025, according to Grand View Research.
Being a connected system which performs numerous transactions each day and exchanges sensitive credit / debit card details over the internet, POS system has become a hot spot for hackers. According to Symantec, POS malware is one of the biggest sources of stolen payment cards for cyber-criminals. There have been a number of retailers and hospitalities were affected by the malware which targeted payment card information of customers. In details, the malware was active to have access to customer names, account numbers, payment card expiration dates and verification codes.
A biometric payment solution can strengthen POS security by deploying a superior authentication method. Personal traits scanned by biometrics are difficult to lose, forget or copy. For this reason, biometric-base POS is considered to be safer and more secure than other traditional ones. Moreover, the advanced biometric system also prevents impersonation and eliminates any possible disputes at the time of final billing.
Many reputed POS manufacturers such as Ingenico, HP, Verifone and NEC have already integrated biometrics into their POS solutions to safeguard user credentials. Biometric modalities that are being used include fingerprint, palm print, facial recognition and iris scan. Additionally, government regulators are also opting for biometric security features. In India, all POS machines will soon be required to be enabled for Aadhaar-based biometric authentication, according to the Reserve Bank of India (RBI) mandate.
At the same time, there’s a growing trend among small and medium retailers in implementing mobile POS (mPOS) terminals. An mPOS is a mobile phone or tablet that performs the same functions as traditional ones. It is installed with a mobile app and integrated with a biometric scanner, barcode scanner and card reader. Unlike fixed tradition POS systems which are complex, need continuous power supply, and involve high maintenance costs; mPOS is more convenient, chargeable, and comes in lower cost.
This new development poses a significant challenge for biometric vendors who have to maintain the reliability and accuracy of biometric technology and simultaneously reduce the product size and cost involved in them. As per the ABI Research, it’s projected that mobile POS will comprise of almost half of all the available POS terminals by the year 2019. It’s no wonder that retailers are investing in such solutions for business operation flexibility and compelling customer experiences.
In the coming years, although North America still dominates the POS market, Asia Pacific is expected to emerge as a lucrative player. Government initiatives to support a cashless economy in countries like India are boosting the demand for POS solutions. Additionally, low penetration and considerable unbanked population is considered a lucrative opportunity for POS growth in the region.