Businesses need secure and user-friendly authentication methods to help prevent the risk of data breaches and fraud. Passwordless authentication — or the process of verifying a user’s identity without a password — is becoming an increasingly popular solution for today’s retailers.
According to Statista, more than 350 million people were impacted by data breaches in 2023.1 Meanwhile, poorly chosen and protected passwords remain a major source of data breaches for web applications.2
That’s where passwordless authentication can help — allowing users to sign in with secure and convenient alternatives like biometrics, security tokens, and one-time codes.
Learn more about what passwordless authentication entails, how to implement this solution for your business, and future trends that are set to impact payment security.
Passwordless authentication is the process of verifying a user’s identity with information other than a password. For example, a user might log in with a fingerprint, face scan, or one-time code sent to their mobile phone.
Compared to traditional authentication methods, passwordless authentication can be more secure and more convenient for both customers and retailers. After all, traditional passwords may be lengthy and difficult to remember. They can also be stolen and leaked, and then used by fraudsters to log into someone else’s account.
Businesses can choose from a range of passwordless authentication methods to help enhance security and improve customer experiences.
Common methods include:
Passwordless authentication offers many advantages for today’s retailers — from faster checkout experiences to reduced security risks.
Here's a closer look at the most notable benefits of passwordless authentication.
Traditional login processes can be frustrating and complex, potentially leading customers to abandon carts mid-checkout.
For retailers with loyalty programs or mobile payment options, passwordless logins can expedite in-store transactions. Fingerprint or facial recognition can replace PINs or passwords, for example, helping lead to faster checkouts.
Frictionless logins not only improve online checkout but also enhance customer experiences in the store. For instance, retailers can invite customers to access their loyalty program rewards and perks via a passwordless login process, further personalizing the shopper journey.
Passwordless authentication can make it harder for fraudsters to gain access to accounts, protecting customer information and helping reduce the risk of fraudulent transactions. This can help businesses not only build trust without customers but also avoid the many potential costs of online fraud.
Implementing new authentication methods can present certain challenges for retailers, such as:
Take these steps to start implementing passwordless authentication for your business:
Passwordless authentication is already revolutionizing online security and customer experiences. As this technology continues to evolve, businesses will need the right tools to seamlessly embed passwordless authentication into their checkout processes.
PayPal provides the innovative technology that today’s businesses need to make that happen — helping reduce the risk of fraudulent transactions and improve the shopper journey. Click here to learn more about PayPal’s authentication features.
Passwordless technologies will continue to evolve, providing retailers with new and innovative ways to verify shoppers and streamline experiences.
That’s why it’s important to stay on top of emerging trends and developments in passwordless authentication technology, such as:
Passwordless authentication is already revolutionizing online security and customer experiences. As this technology continues to evolve, businesses will need the right tools to seamlessly embed passwordless authentication into their checkout processes.
PayPal provides the innovative technology that today’s businesses need to make that happen — helping reduce the risk of fraudulent transactions and improve the shopper journey. Click here to learn more about PayPal’s authentication features.
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