F&S: Classifeye's solution offers strong authentication in a snapshot

We have noticed Israeli based start-up called Classifeye, a company with an innovative e-commerce solution. Frost & Sullivan has noticed them, too. F&S says that to increase the security of transactions, without incurring more costs or sacrificing consumers’ convenience, banks and financial institutions are trying to get a better grasp on everyday technology that will allow them to present and offer different options to existing and future clients.

F&S says that a good example for this approach is Mobile banking. The services that are offered on mobile-banking platforms provide both cost savings to the banks in human resources expenses and manual transactions while offering time and cost saving services to clients. To date, the mobile banking market is growing rapidly, having a CAGR growth rate of 4 percent and reaching an estimated $3.7 million in revenues in 2008. This market is expected to increase at an estimated CAGR of 14 percent, reaching revenues in the amount of $14.7 million by 2012.

The major restraints that are slowing the mobile banking market have to do with the difficulty in authenticating the identity of the mobile banking user. While E-banking has a lot of strong authentication methods to verify the identity of the user such as tokens and knowledge based questions, mobile banking has different usability needs and is more prone to malicious usage as mobile devices are easily stolen, therefore common strong authentication solutions are not sufficient for mobile banking.

Which brings us back to Classifeye. F&S notes that Classifeye has developed a solution that not only upgrades the strong authentication that is in use today, but also uses a regular device to do so. Classifeye has developed a solution that uses the camera built into the mobile handset. By taking a picture of two fingers with the camera, Classifeye’s solution can biometrically authenticate the user. This solution is a great way to upgrade the strong authentication most used today from the “what you have” factor like a token to a “what you are” factor like a fingerprint in the two factor authentication method.

“Classifeye understands that in order to penetrate this market there is a need to develop an authentication solution that is both easy to use, provides a higher standard of authentication, and has a very low error and false positive ratio,” F&S says

A main vertical sector that could use Classifeye’s solution is the E-banking vertical. Most banks are thinking of distributing hardware or software OTP solutions to end users for conducting transactions. These solutions come with distribution costs and added support and hardware costs. “Having Classifeye’s solution will not only reduce the total cost of applying a two factor authentication solution but will also upgrade the security as this solution is biometric and harder to overcome,” F&S notes. The research form concludes:

Frost and Sullivan believes that solutions like the Classifeye solution will enable mobile banking to grow while reducing the overall branch costs of the different financial institutes and enhancing the overall “instant” services and offerings that the banks have today. These attributes are critical to the times we are experiencing now when cost reduction is a key driver in any product or service that is offered to the different markets.