Noha Gad

Digital wallets have become central to the way consumers conduct payments and manage their finances, offering convenience and seamless digital transactions. Their widespread adoption in retail, banking, and peer-to-peer transfers has made them a preferred alternative to cash and physical cards. 

These wallets handle increasing volumes of sensitive financial data; thus, robust security measures cannot be overstated. Traditional password protections alone are no longer sufficient to combat sophisticated cyber threats and fraud schemes targeting these platforms.  

Emerging security technologies, such as multi-factor authentication (MFA), decentralized identity (DID) solutions, artificial intelligence (AI), machine learning (ML), and tokenization, are addressing these demands by introducing multi-layered protection methods.

Multi-factor authentication (MFA)

The MFA technology significantly enhances digital wallet security by requiring users to verify their identity through multiple independent factors before granting access. Common MFA methods in digital wallets include one-time passwords (OTPs) sent via SMS or email, biometric verification through fingerprint or facial scans, and hardware tokens that generate secure codes. This layered approach makes unauthorized access much more difficult for attackers.

Another type of factor used is certificate-based authentication, which relies on a digital certificate, also called a soft token, to identify a user, machine, or device before granting access. Most enterprise solutions already support certificate-based authentication, and many wallets, such as those by Google Pay and Apple Pay, deploy this in coordination with traditional methods such as a username and password/PIN. 

Although the integration of the MFA reduces fraud rates and unauthorized account access, challenges remain in ensuring universal adoption and maintaining user convenience without compromising security. As cyber threats become increasingly sophisticated, MFA represents a foundational barrier that protects users’ financial assets and sensitive information from theft and compromise. Its continued evolution and adoption will remain critical to maintaining trust in digital payment ecosystems.

Decentralized identity (DID) solutions

A decentralized Identifier (DID) is a unique identifier that can be issued by a decentralized platform and acts as proof of ownership of a digital identity. DID solutions use cryptography and distributed systems, often blockchain technology, to give individuals total control over their digital ID, which is seen as a more tamper-resistant and privacy-preserving method. 

Unlike traditional identity systems that rely on centralized authorities to issue and manage identities, decentralized identity empowers users to create, control, and manage their own digital identities without depending on any single entity. This shift reduces vulnerabilities inherent in centralized databases, which are prime targets for cyberattacks and data breaches. 

This modern approach enables individuals to have full ownership and control over their personal data, allowing them to decide what information to disclose, to whom, and for how long. For digital wallets, DID integration means users can authenticate themselves and verify transactions without exposing unnecessary personal or sensitive data, thereby reducing the attack surface and building user trust by preventing mass data leaks.

AI & ML in fraud detection

Artificial intelligence (AI) and machine learning (ML) play a pivotal role in advancing fraud detection capabilities within digital wallets as they analyze vast amounts of transactional data in real time and identify patterns and behaviors that deviate from normal usage. AI and ML algorithms can adapt to evolving fraud tactics, enabling proactive detection and prevention before fraudulent transactions are completed.

AI-driven systems harness advanced techniques such as anomaly detection, risk scoring, and predictive modeling to assess each transaction's legitimacy. This dynamic assessment improves the accuracy of fraud detection compared to static rule-based systems that may either miss complex fraud schemes or generate excessive false alarms.

Meanwhile, ML models in digital wallets leverage user behavior analytics, tracking factors like device usage, login patterns, and payment frequency to establish individualized risk profiles that distinguish genuine users from potential fraudsters more effectively, ultimately minimizing disruptions caused by unnecessary transaction denials. 

Integrating AL and ML technologies into digital wallets not only minimizes fraud losses but also promotes operational efficiency by automating risk management processes. These technologies are expected to offer more advanced defenses, including real-time threat hunting and adaptive authentication that dynamically adjusts security measures based on assessed risk levels.

Tokenization 

This technology is crucial for securing digital wallet transactions as it replaces sensitive payment information with unique, non-sensitive identifiers called tokens, which carry the necessary transaction data without exposing actual card numbers or bank details during payment processing. 

Unlike traditional encryption methods, tokenization stores actual account information in highly secure token vaults, isolated from merchants and payment processors.

Digital wallet providers have widely adopted tokenization to comply with stringent security standards such as the Payment Card Industry Data Security Standard (PCI DSS), enhancing consumer confidence and regulatory compliance. 

Along with protecting sensitive information, tokenization creates opportunities for innovative payment experiences, standing as a foundational security element that ensures transactions remain secure, seamless, and user-friendly.

Saudi Arabia has been significantly integrating emerging technologies to enhance the security of digital wallets, in line with Vision 2030’s goal of promoting a cashless society and digital economy. The Saudi Central Bank (SAMA) is a key contributor to this transformation, starting from regulating digital payment providers under comprehensive frameworks to creating an enabling environment for digital wallets to adopt advanced security technologies.

The Kingdom is actively incorporating AI and ML into the national fintech ecosystem to enhance transaction monitoring, fraud detection, and risk assessment, thereby increasing transparency and accountability while ensuring a secure cashless transaction environment.

Along with technology adoption, Saudi Arabia backs fintech innovation through significant investments supported by government entities and partnerships with regulatory bodies, aiming to stimulate the development and market reach of advanced digital wallet solutions incorporating MFA, AI, DIDs, and tokenization.

Finally, digital wallets continue to transform payments by merging convenience with cutting-edge security technologies to protect user data and ensure transaction integrity. These technologies provide a multi-layered defense framework that ensures digital wallets remain secure, seamless, and trustworthy in an increasingly digital financial environment. The integration of these multi-layered protections will definitely establish a strong foundation for sustainable digital finance growth, while prioritizing security innovation. 

Ghada Ismail
 

The way we pay is changing. Again! From magnetic stripes to chip cards, mobile wallets, and wearables, each wave has brought more convenience and speed. Now, the next frontier may be something far more innate: the human palm.

Palm recognition technology, once confined to high-security settings, is making its way into everyday finance. With a simple wave of the hand, users can authorize payments, verify their identity, and access services with no phone or card required. Tech giants like Amazon have already introduced palm-scanning systems across retail, entertainment, and even healthcare. Pilots are also appearing across Asia and the Middle East, including rising interest in Saudi Arabia and the GCC.

As digital economies seek faster, safer, and more inclusive payment options, palm biometrics offer a compelling solution. But they also raise valid questions around privacy and surveillance. Is this frictionless future a leap forward—or a little too close for comfort?

Either way, the next era of financial access may be closer than we think—literally in the palm of our hands.

How Palm Recognition Works
Palm recognition systems use near-infrared light to scan the unique vein patterns beneath the skin; an internal signature nearly impossible to forge. The data is encrypted and stored securely, often in cloud-based environments. During authentication, users simply hover their palm over a scanner, and the system matches the scan to their registered biometric template in under a second.

Amazon has been a leading adopter with its “Amazon One” system, which combines palm and vein imagery for high-accuracy authentication. The technology integrates with existing payment networks like Visa and Mastercard, allowing users to link their palm to a digital wallet or bank account.

Fintech Use Cases Around the World

Amazon One in Whole Foods and Beyond

• Retail Rollout: Amazon One is now active in more than 500 Whole Foods Market locations across the U.S., following a nationwide expansion completed in 2023.
• Airports & Venues: The technology is also in use at major airports and sports stadiums, including retail outlets in U.S. terminals and venues like Coors Field.

Healthcare Innovation at NYU Langone Health

• In March 2025, NYU Langone Health began rolling out Amazon One for patient check-in, offering a contactless alternative at its clinics and hospitals.

International Developments

• Singapore: At the 2024 Singapore Fintech Festival, Tencent and Visa jointly piloted palm-based payments. After a one-time registration, customers were able to pay with their palm at participating cafes.
• China: In Beijing, passengers on the Daxing Airport Express Line can use palm recognition via WeChat Pay to enter the metro—no cards or phones required.

These examples show that palm biometrics are no longer experimental. They're entering the mainstream.

Why Fintech Is Embracing the Palm

Palm biometrics offer a mix of advantages that appeal to fintechs and users alike:

• Speed: Authentication is virtually instantaneous, reducing queues and wait times.
• Security: Vein patterns are internal and highly resistant to spoofing, offering stronger protection than fingerprints or facial recognition.
• Hygiene: Fully contactless, palm scanning is ideal for public environments—especially post-pandemic.
• Accessibility: Palm authentication offers a device-free option for people without smartphones or physical cards, improving financial access.

These benefits are especially relevant in emerging markets and among unbanked populations, where biometrics can play a crucial role in digital inclusion.

The Privacy Debate

Despite its promise, palm recognition raises valid privacy concerns. Since vascular patterns are immutable, a breach of biometric data could have long-lasting consequences.

Amazon states that palm data captured by Amazon One is encrypted and stored securely in the AWS Cloud, emphasizing that it is not shared with government agencies or advertisers. While this commitment offers some reassurance, privacy advocates remain cautious. The lack of universal regulation on biometric data storage, retention, and usage leaves room for concern—particularly in countries without strong consumer protection frameworks.

Building public trust will require transparency, user consent mechanisms, and robust oversight.

Regional Innovation: Palm Tech Expands Across the Middle East and Africa
In the Middle East and Africa, palm recognition is gaining traction beyond global tech giants. IDCentriq, a leader in biometric authentication, participated at Seamless Middle East 2025, held from 20–22 May at the Dubai World Trade Centre, where the company unveiled its ePalm palm-vein authentication technology, designed for secure, contactless identity verification in government and financial sectors.

Ali AlMeshal, CEO of PaymentsCo for the GCC, a regional subsidiary of IDCentriq, said: “Adopting technologies like ePalm will be crucial in fostering consumer confidence and driving growth in the digital payments landscape across the GCC.”

Led by Executive Chairman and CEO Muhanad Azzeh, IDCentriq is positioning ePalm as a homegrown solution tailored for the region’s shift toward cashless economies and digitally integrated public services.

Saudi Arabia’s Palm Vein Scanner Market Gathers Momentum

In Saudi Arabia, the palm vein scanner market is gaining traction as demand grows for secure, contactless biometric authentication across key sectors like healthcare, finance, and government, according to a report issued by 6wresearch in 2023. The technology’s ability to provide precise, tamper-resistant identity verification using subdermal vein patterns makes it particularly appealing in a country prioritizing advanced security infrastructure.

The Covid-19 pandemic accelerated adoption, as institutions sought hygienic, touch-free solutions for access control and identity management. Today, palm vein scanners are increasingly being deployed in high-security environments and customer-facing applications where trust and privacy are paramount.

Still, challenges remain, particularly around ensuring accuracy, public acceptance, and robust data protection. Key players active in the Saudi market include Fujitsu, Hitachi, and M2SYS Technology, all offering solutions tailored to the Kingdom’s growing need for scalable, secure authentication systems.

The Road Ahead

Palm recognition is still novel, but its rapid global rollout suggests it's more than a passing trend. As companies like Amazon expand internationally, and as fintechs across Asia and the Middle East chase frictionless user experiences, palm biometrics are emerging as a serious contender in the future of digital identity.

In Saudi Arabia and beyond, the next big step in financial access may require nothing more than a wave of the hand.

No card. No phone. Just a palm.

Ghada Ismail

Imagine this: You walk into a café in Riyadh, place your order, and confirm payment with just a glance. Across Saudi Arabia, this once-futuristic scenario is rapidly becoming a reality as biometric authentication takes center stage in the fintech landscape. As security concerns rise and users demand faster, frictionless experiences, biometric solutions are proving to be the answer.

Saudi Arabia’s drive for secure and seamless digital experiences has made biometric authentication more than just a technological trend; it's now a national imperative. In an age of growing digital financial activity, especially among younger, mobile-first users, fintech companies are racing to integrate facial recognition, fingerprint scanning, and behavioral biometrics into their platforms to enhance user trust and meet evolving regulatory standards.

Types of Biometric Authentication Powering Saudi Fintech

As Saudi Arabia’s fintech sector accelerates its digital transformation, various biometric technologies are being deployed to secure transactions and enhance user experience. Here's a closer look at the most prominent types of biometric authentication shaping the future of digital identity in the Kingdom:

• Facial Recognition: Widely used in mobile banking apps and national ID verification platforms like ‘Nafath’, facial recognition analyzes unique facial features to confirm a user’s identity with just a glance.
• Hand Geometry: Less common in fintech, hand geometry systems measure the shape and size of a user’s hand, often used in physical access control in high-security financial institutions.
• Voice Recognition: Increasingly popular, especially in customer service applications, voice biometrics allow for voice-based logins and verification, offering a smoother, hands-free authentication process.
• Signature Recognition: Used in both digital and physical banking, signature recognition authenticates users based on the unique shape and pressure pattern of their signature, often applied for fraud detection and e-signature validation.
• Iris Recognition: Capturing unique patterns in a person’s iris, iris recognition is primarily used in government and border control but is being explored in high-security financial applications.
• AFIS (Automated Fingerprint Identification Systems): AFIS compares fingerprints against large-scale databases, commonly used by national ID systems and banks for quick, secure identity verification.
• Non-AFIS: These systems are used for one-to-one fingerprint verification, common in personal devices and point-of-sale terminals for consumer transactions.
• Other Emerging Methods: Behavioral biometrics (e.g., keystroke dynamics, mouse movement patterns), palm vein scanning, and heartbeat recognition are being explored as supplementary layers to enhance fintech security frameworks.

Key Statistics on Biometric Authentication in Saudi Fintech

• Biometrics Market Growth: Saudi Arabia's biometrics market was valued at USD 394 million in 2024 and is projected to reach USD 1.35 billion by 2033, growing at a CAGR of 14.7%. This growth is driven by the widespread use of smartphones and the integration of biometric authentication methods such as fingerprint recognition, facial recognition, and iris scanning into mobile platforms.
• Voice Biometrics Expansion: The voice biometrics market in Saudi Arabia reached USD 50 million in 2024 and is expected to grow to USD 220 million by 2033, with a CAGR of 18.9%. This expansion is fueled by government-led digital transformation initiatives, rising cybersecurity threats, and increasing mobile banking adoption.
• Biometric Payment Cards Adoption: The biometric payment cards market in Saudi Arabia generated USD 1.4 million in 2023 and is expected to reach USD 55.5 million by 2030, growing at a CAGR of 69.5% from 2024 to 2030. Credit cards were the largest revenue-generating card type in 2023 and are projected to remain the most lucrative segment during this forecast period.
• Passwordless Authentication Market: The passwordless authentication market in Saudi Arabia was valued at USD 278.7 million in 2024 and is projected to reach USD 828.9 million by 2030, growing at a CAGR of 19.4% from 2025 to 2030, reflecting rising demand for secure and user-friendly authentication solutions in the digital landscape.
• Unified National Access (Nafath): Saudi Arabia’s Unified National Access system, ‘Nafath’, has executed over 3 billion verification operations as of November 2024. This national digital identity system allows citizens and residents to access over 530 government and private platforms and applications with a single sign-on identity provider service.

Saudi Players Leading the Charge

• Al Rajhi Bank: One of the largest Islamic banks globally, Al Rajhi has integrated facial recognition into mobile banking for secure logins and transaction confirmations. The bank is also piloting voice recognition for customer service interactions, significantly reducing verification times.
• STC Pay: Saudi Arabia’s leading digital wallet has implemented biometric KYC (Know Your Customer) systems to streamline user onboarding and comply with Saudi Central Bank (SAMA) regulations. Facial and fingerprint recognition is used for faster account setup and secure access.
• Mozn: This Riyadh-based AI and data analytics startup, known for its digital identity and anti-fraud technologies, is exploring biometric authentication as part of its advanced fraud prevention solutions for fintech clients.

Beyond Banking: Everyday Applications

In Saudi Arabia’s expanding fintech ecosystem, biometric tools are being integrated beyond traditional banking services:

• Buy Now, Pay Later (BNPL) platforms like Tabby and Tamara are experimenting with biometric ID for credit risk assessment.
• Digital mortgage providers are considering retina and fingerprint scans for document validation and secure sign-offs.
• Mobile-first insurance apps are introducing biometric login for policy management and claims submissions.

Regulation & Privacy: Striking the Balance

As biometric authentication becomes increasingly embedded in Saudi Arabia’s fintech infrastructure, regulatory compliance and data privacy are of paramount importance. Central to this landscape is the Personal Data Protection Law (PDPL), enacted to safeguard personal information and ensure responsible data practices across all sectors, including fintech.

Under the PDPL, biometric data is classified as sensitive personal data, meaning it is subject to strict controls. Fintech companies must obtain explicit consent from users before collecting or processing biometric information, such as facial recognition, iris scans, or fingerprint data. The law mandates that this data be securely stored using encryption and can only be used for clearly defined, lawful purposes.

This regulatory framework is especially critical for fintech platforms that intersect with sensitive sectors like digital health, insurance, and government-linked financial services. Biometric features often double as identity verification mechanisms, and any misuse, data breach, or lack of transparency could undermine consumer trust and result in penalties.

To navigate this, local startups and financial institutions are investing in compliance frameworks, privacy-by-design systems, and data governance protocols that align with PDPL requirements while fostering innovation. The challenge lies in balancing privacy with innovation to support the growth of next-generation fintech solutions.

Pros and Cons of Biometric Authentication

As biometric authentication gains traction in Saudi Arabia’s fintech sector, it's important to consider both the benefits and the limitations.

Advantages:

• Enhanced Security: Biometric traits are unique and difficult to replicate, making them more secure than traditional passwords or PINs.
• User Convenience: Customers can access services quickly using facial recognition or fingerprint scans—no need to remember complex credentials.
• Fraud Reduction: Biometric systems reduce the risk of identity theft and unauthorized access by tying identity verification to biological features.
• Scalability: As mobile and digital banking rise, biometric systems can be seamlessly integrated across platforms, improving the overall customer experience.

Disadvantages:

• Privacy Concerns: Storing and processing sensitive biometric data raises privacy issues if not properly secured.
• False Positives/Negatives: No system is flawless; errors in recognition can lead to service denial or security breaches.
• Cost of Implementation: Deploying biometric systems requires advanced hardware, software, and infrastructure, which may be costly for smaller institutions.
• Data Breach Risk: Unlike passwords, biometric data cannot be changed if compromised, making data breaches particularly risky.

As the fintech sector matures, addressing these challenges through robust encryption, anonymization, and clear regulation will be crucial to building public trust and accelerating adoption.

Conclusion: Shaping the Future of Fintech with Biometric Authentication

Biometric authentication is poised to be a cornerstone of Saudi Arabia’s digital transformation, offering enhanced security and user convenience. As the fintech sector grows, balancing innovation with privacy and regulatory compliance will be essential.

For innovators, the challenge is to integrate cutting-edge technologies while respecting user rights. For regulators, it’s about evolving frameworks that keep pace with change. And for consumers, it’s about demanding transparency and control over personal data.

The future of fintech in Saudi Arabia will be defined by how we navigate these complexities—now is the time to lead with responsibility, security, and trust.