The way we access internet, mobile and phone banking is to be revolutionised as a host of new biometric technologies are rolled out by the big financial institutions.

HSBC is to launch voice recognition for phone banking and touch security log-in technology for mobile banking, saving its customers from having to remember passwords or personal identification numbers based on their inside leg measurements or pet names before accessing their accounts.

The announcement comes just weeks before the launch of Atom Bank, one of the new breed of so-called ‘challenger banks’, which will be using face recognition technology to allow customers to log in quickly.

Voice recognition software for banking is not new, but so far has only been used on a small scale. Barclays introduced the technology in 2013 but has so far only make it available to a small number of corporate clients. RBS and NatWest, meanwhile, have been offering finger print technology via an Apple mobile device for a year.

HSBC’s move will see the voice and fingerprint technology being offered to First Direct customers in the next few weeks, followed by HSBC’s customers over the summer, bringing the technology to over 15 million UK customers.

According to Francesca McDonagh, HSBC UK’s head of retail banking, the move will be “the largest planned rollout of voice biometric security technology in the UK”.

HSBC’s voice biometrics technology is being supplied by Nuance Communications which has developed a system which checks over 100 unique voice identifiers.

These include behavioural features such has speed, cadence, accent and pronunciation as well as measurable physical aspects such as the shape of the larynx, vocal tract and nasal passages.

Once customers have opted in to the service, they will have to record a “voice print” after which they can dispense with their passwords and the need to memorise password information.

When they next login they will be prompted to say a few words and the technology will compare this with their voice print.

Even if somebody has a cold the system will still work as their accent, cadence or pronunciation remain the same regardless of whether they are unwell.

Other identification technologies currently under development include heart-rate recognition (which measures the unique pattern of people’s hearts), vein-pattern recognition (which recognises the unique pattern of veins in the hand, wrist or arm), blood flow recognition (where the blood flow through a customer’s hand is measured by a mobile phone) and iris and retina recognition.

A recent YouGov survey found that more than a third of people now believe that traditional passwords are an outdated security measure.

The survey found that 38 per cent of people use the same password for most of their online activity while 55 per cent rarely update their passwords, which makes it easier for hackers to obtain their personal data.

HSBC’s latest innovation comes only weeks after the bank was the victim of a “denial of service attack” which caused its personal banking website and mobile app to crash. The cyber attack came less than a month after a major systems failure which stopped customers accessing their accounts for nearly two days.

While the high street banks are now investing millions in improving their user identification systems, experts claim this is only tinkering at the edges and that IT failures are becoming a regular occurrence.

As competition hots up with the launch of new challenger banks such as Atom Bank or Starling, the high street banks may have little alternative but to invest in new systems if they want to avoid losing customers.


The banking app that tells you to stop buying caffé lattes

Get ready for “Nudge” app. Which will ‘poke’ bank customers to spend and save a little more wisely.

A new app from HSBC is now giving customers worried about their spending habits a nudge when it thinks they are spending too much.

The “Nudge” app works by comparing a user’s spending habits with other people in a similar income bracket as well as other metrics.

If they appear to be spending too much on dining out or too much on coffees in a month the app gives them a virtual slap on the wrist by sending them a text suggesting they need to be less profligate.

The app also sends messages to users designed to fortify their willpower and to make them focus on their long-term financial goals.

Users also receive notifications on how much they spent on groceries the previous week as well as data on whether they are spending or saving more than other users.

By applying a behavioural theory called the “Nudge theory”, the idea is that that customers will be encouraged to spend more wisely, save more, make better decisions and, in the long-term, improve their spending habits.

One suggestion gives users the option of diverting spare cash to a savings account at the end of the month.

The mobile gadget is now being trialled by around 500 HSBC staff and will be fine-tuned over the coming months before being launched publicly.

Various banks currently offer a text message service notifying customers when they are close to breaching their overdraft limit or simply informing them about their balance and recent transactions on a weekly or daily basis.

HSBC claims that its overdraft limit text message service has already saved its customers £85 million in overdraft charges.

The new Nudge app takes this further by offering 38 different types of targeted personalised advice or “nudges”.

The free app is available to anyone who says they want help with their spending, with HSBC saying it is keen that the system does not nag those who do not need or want it.

Raman Bhatia, the HSBC executive behind the app, said: “We know that many of our customers have good intentions for their financial futures, but willpower alone is not always enough to drive a long-term change in behaviour.

“By incorporating nudge theory into our digital customers’ communications, we can encourage customers to adjust their behaviour to achieve their financial goals.”