- Passkeys offer a more secure and user-friendly alternative to passwords.
- Early adoption is strong in e-commerce and hospitality, though banks remain cautious.
What happened: Passkeys gaining traction as a secure payment solution
The internet’s dependence on passwords has led to significant security risks, with breaches often traced back to weak or stolen passwords. As a result, industries are exploring passkeys as a safer, more convenient alternative. Andrew Shikiar, executive director and CEO of FIDO Alliance, explains that passkeys eliminate vulnerabilities by offering encrypted communication between a virtual key pair, making them more secure than traditional passwords.
Shikiar highlights that over 12 billion consumer accounts now offer passkey support, with hundreds of millions of users already adopting this technology. The consumer sector, particularly e-commerce, content, and hospitality, is seeing rapid passkey adoption due to its security and ease of use. Despite this, traditional banks remain hesitant to embrace the technology, though neobanks are leading the way.
Also read: Microsoft pushes passkeys no opt-out option for customers
Also read: Mastercard partners with Sympla and Yuno to launch Payment Passkey
Why it’s important
Passkeys are gaining traction as a more secure and user-friendly alternative to passwords, particularly in sectors like e-commerce and hospitality, where security is crucial. The widespread adoption of passkeys could reduce the number of data breaches caused by compromised passwords. However, the challenge remains in convincing more conservative sectors, like traditional banking, to fully embrace this new technology. As industries and regulators continue to show support, passkeys could become the future of secure payment authentication, simplifying user access and enhancing online security.
