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What's Protecting Your eWallet?

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Recently, Apple has agreed to spend $356 million to purchase a fingerprint-reading company called AuthenTec. Why would they do this? As we all know, our wallets are switching from being leather to being digital. And, they're going to be more phone-based, meaning that in the future, your wallet is your phone.

Does that mean that paper money will go away and we will be completely cashless? The answer is "no," but we will use cash less often and instead make purchases using our smart phones. This makes security even more important.

Currently, smart phone manufacturers are adding near-field communications (NFC) chips to their new models. These chips can help to speed a transaction when you're buying something. You just get your smart phone close to a cash register that's equipped with a NFC reader and you can make the transaction quickly and with a good level of security.

But what happens if somebody steals your phone? That can be bad news. That's why in the near future, we're going to be increasingly using biometrics. And thank goodness, because it's getting difficult to remember all those passwords! Besides, it's fairly simple for someone to hack a system and gain access to passwords.

In comes biometrics to the rescue! Now we can see how Apple's recent purchase makes perfect sense. After all, when you have your phone, you're touching it. Since you're touching it, why not put a fingerprint reader on it? The old-fashioned kind of fingerprint is to look at the pattern of the skin. The newer fingerprint readers can look at the blood vessel pattern underneath your skin. It's difficult to bypass or hack that.

But let's not stop there. Let's look ahead a little, to what I call second-generation biometric applications. You also use the phone to talk. And my voice is different than your voice. So we can do an audio biometric check to make sure you're you. Plus, the phone has a camera. That means we can do facial recognition biometrics, which has been fine-tuned to be quite accurate. Using all these things together -- your fingerprint, your voice, and your face -- we can know you are you and not someone else.

In the near future, we'll be using multiple biometrics, depending on the level of security you want when you're making the purchase. So if you're simply looking at a website where you need a password, only one biometric may be warranted. But if you're going to withdraw money from your bank account, you may want to use three forms of biometrics. And if you lose your phone, you can rest easy knowing it isn't going to work for anyone who doesn't have you with them -- your biometrics.

So, increasingly, we'll see biometrics being used on our phones and tablets, and on all our computing devices as we make the switch from the leather wallet to the digital wallet.

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