Why banks must adopt biometrics to fight financial fraud

Biometrics are rapidly shifting from optional security features to a cornerstone of financial crime prevention strategies worldwide.

Regulators across Europe, Asia, and beyond are steadily tightening requirements, compelling banks to upgrade authentication systems.

SymphonyAI recently delved into how this shift is not simply about innovation but is rapidly becoming a compliance requirement.

The EU’s PSD2 framework set the tone by mandating multi-factor authentication, with biometrics fitting neatly into the “something you are” category. The UK’s Financial Conduct Authority has followed suit, encouraging financial institutions to explore innovative tools like behavioural biometrics that enhance fraud detection without adding friction for customers.

In Asia, India’s Aadhaar system enables secure digital identity verification for millions, while the Philippines’ central bank plans to phase out SMS-based one-time passwords by mid-2026 in favour of stronger, passwordless methods. Malaysia already requires biometric checks for digital onboarding under its e-KYC rules, and Australia is preparing similar mandates under its Scams Prevention Framework.

Behavioural biometrics—analysing how users type, swipe, or interact with devices—are particularly appealing because they operate invisibly, providing continuous authentication while enhancing the customer experience. SymphonyAI noted that this technology learns and adapts, creating a dynamic defence system that keeps pace with evolving threats.

With regulatory scrutiny increasing across multiple jurisdictions, banks still relying on outdated methods risk falling behind both in compliance and customer expectations. As SymphonyAI highlighted, biometrics are quickly becoming not just a competitive advantage but a regulatory requirement for financial institutions worldwide.

For more about how biometrics are improving compliance, read the full story here.