Fed Upgrades View of Economy While Keeping Rates Near Zero

The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.

The COVID-19 pandemic is causing tremendous human and economic hardship across the United States and around the world. Amid progress on vaccinations and strong policy support, indicators of economic activity and employment have strengthened. The sectors most adversely affected by the pandemic remain weak but have shown improvement. Inflation has risen, largely reflecting transitory factors. Overall financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.

The path of the economy will depend significantly on the course of the virus, including progress on vaccinations. The ongoing public health crisis continues to weigh on the economy, and risks to the economic outlook remain.

The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. With inflation running persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer‑term inflation expectations remain well anchored at 2 percent. The Committee expects to maintain an accommodative stance of monetary policy until these outcomes are achieved. The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee's assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. In addition, the Federal Reserve will continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month until substantial further progress has been made toward the Committee's maximum employment and price stability goals. These asset purchases help foster smooth market functioning and accommodative financial conditions, thereby supporting the flow of credit to households and businesses.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Thomas I. Barkin; Raphael W. Bostic; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Mary C. Daly; Charles L. Evans; Randal K. Quarles; and Christopher J. Waller.

Implementation Note issued April 28, 2021

Loan Ratio, Yields To Hit Lows By Year End; Membership Growth Slows, But CUNA Mutual Sees Better Days Ahead

MADISON, Wis.–The CU industry loan-to-share is expected to hit an eight-year-low, and yield-on-assets ratio should hit an all-time low by year end, according to a new forecast from CUNA Mutual. ROA is also expected to decline.

Meanwhile, lending at credit unions is projected to grow just 5% in 2021.

One bright spot: new-auto loan balances rose at a 0.1% pace in February, the first positive growth number since July 2019, according to CUNA Mutual’s April Trends Report, which is based on CU data through February 2021.

Just 221,000 new members were added during the first two months of the year, down from 641,000 reported in the first two months of 2020, the Trends Report added.

Another bright spot: The CUNA Mutual forecast sees a much stronger economy ahead.

Overall, CUNA Mutual’s economists said they expect the U.S. economy to grow at a “remarkable” 6% in 2021. That would be the fastest annual growth since the 7.2% reported in 1984, which followed on the heels of the severe recession in 1982.

“Looking farther down the road we expect 4% growth in 2022. The last time the economy grew at 4% or above was way back in 2000, right before the stock market crash in 2001,” CUNA Mutual stated.

Here’s a look at how credit unions performed by category during the first two months of the year: READ MORE CUToday

Existing-home sales fell 3.7% in March

ARLINGTON, Va.—Existing-home sales fell 3.7% in March to a seasonally-adjusted rate of 6.01 million units, representing a 12.3% increase in sales versus a year ago.

Curt Long

"Headwinds are mounting as mortgage rates spiked 20 basis points over the course of the month, causing demand to dip and buyers to hold off," said Curt Long, NAFCU's chief economist and vice president of research. "Mortgage applications have also fallen to their pre-pandemic level.

"New homes being built should also relieve some price pressure, but they won’t be ready until later in the year. NAFCU expects sales to be strong for the rest of the year, only limited by supply and the resulting price increases," concluded Long.

Sales fell in all four regions in March, with the West seeing the largest drop (-8%), followed by the South (-2.9%), Midwest (-2.3%), and Northeast (-1.3%). Versus a year ago, sales were up in all regions over the month.

The median existing-home price rose from $310,700 in February to $329,00 in March (not seasonally-adjusted), representing a 17.2% increase from the median price a year ago.

NCUA Director R. Hood "NCUA chairman needs to put more serious issues on the board meeting agenda".

ALEXANDRIA, Va.–A former NCUA chairman is suggesting the current NCUA chairman needs to put more serious issues on the board meeting agenda.

During remarks offered during the April board meeting, at which the board was provided updates and at which no votes took place, NCUA board member Rodney Hood, who was replaced as chairman by the Biden Administration by Todd Harper, closed his comments relative to the NCUSIF by saying there are meatier matters to be dealt with.

“In closing, if I may Mr. Chairman, today’s agenda is extremely light,” said Hood. “I hope we can work together in a bipartisan fashion in the months ahead to have board agendas that are much more robust. The credit union community and this board deserve it.”

At issue are a number of proposals on which Harper cast a dissenting vote while he was a board member prior to being elevated to chair. As the lone Democrat, Harper is in the minority with fellow board members Rodney Hood and Kyle Hauptman being Republican appointees. That has led to a number of 2-1 votes.

In December 2020, for instance. Harper voted against a proposal on mortgage servicing rights, which he called “half baked.” In February, Harper voted against NCUA’s “Services Facilities” proposal, saying the proposal “could render the Federal Credit Union Act requirement a near nullity.”

While he is in the minority, as chairman Harper does control the board agenda.

In response to Hood’s comment, Harper said agency staff are working through a number of complex issues, including proposals related to capitalization of interest and derivatives powers on which he said, “I’m hopeful we can see action in the near future.”

 

Albany Firemens's FCU is now "NY Firefighters Bravest FCU"

The Albany Firemen’s Federal Credit Union is announcing a name change to NY Firefighters Bravest Federal Credit Union. This change is in addition to a new TIP charter that will allow all New York State Professional Firefighters the ability to join our credit union. We will be able to serve firefighters, which was our original field of membership.

Our outreach program will start with a new branch established in Manhattan. This opportunity will allow the FDNY firefighters to be served by a credit union that deals with the lifestyle and demands of firefighters.

Our 85 years of operating in the Albany area with 3 branches has given us the experience to open the new branch with our personal member attention and services that will meet the needs of our new members. Our new website can be found at www.nybravestfcu.org

Credit union board members are industry heroes.

Today’s environment just might be the most challenging one that credit union boards have faced in modern memory. The pressures of serving on volunteer credit union boards are extremely high. Just like their counterparts on paid boards at for-profit companies, credit union boards have a major fiduciary responsibility, without the attendant compensation and often without appropriate recognition. Yet like their for-profit counterparts, they govern substantial financial organizations and are responsible for managing capital risk.

Credit union board members are industry heroes. They assure member service and financial safety through their leadership in good governance. They provide insights into strategic goals. They oversee management of risk, which seems greater today than ever before. Current issues include an intensely competitive environment, often from larger and better funded entities. Organizational stresses include litigation, regulatory compliance and decisions related to technology and investment capital for hardware, software and cybersecurity protection.

This is hard work. Every director must ask themselves why they joined the board, and whether they have the capacity to continue serving at the highest of levels. 

They must consider questions like:

1. Do you fully understand current expectations of board service?

2. Are you clear on the credit union’s mission and statement of purpose?

3. Do you understand fiduciary duties of care, loyalty and obedience, and are you familiar with your directors and officers (D&O) policy?

4. Do you understand the charter and workings of each board committee?

5. Are you prepared to fully participate and engage in both committee and board meetings?

6. Do you have access to organizational leadership to learn all you need to assess your participation?

7. Are you satisfied with the “tone at the top” in addressing ethical conduct and compliance with law and regulation?

8. Does the board have an effective onboarding process?

Ongoing board service demands additional board member attention. Consider the following:

1. Are you fully up to speed on, and given full access to, the organization’s business plan? And do you receive data on member satisfaction?

2. Is the board fully engaged in Enterprise Risk Management (ERM)?

3. Do you understand the technological needs and investment requirements for safe and effective operation, including a robust cybersecurity plan?

4. Do you fully understand the appropriate relationship between board and management?

5. How effective is the board in assessing the effectiveness and accountability of the C-suite?

6. Is there a succession plan in place?

7. Is the board committed to Diversity, Equity & Inclusion (DEI) and Environmental, Social & Governance (ESG) awareness?

8. Do you review the impact associated with reputational risk and your continuing service on the credit union board?

9. How effectively do you participate in board conversations, and are you comfortable with challenging conversations when you have a different point of view?

“Duty of Loyalty” requires directors to be well informed to proceed in good faith in making business decisions in the best interest of the organization. Board members must now devote more time, effort and talent to keep themselves fully informed to oversee the credit union’s operations, policies and strategy.

The attention to “Duty of Care” is also increasing. Do you actively participate in strategic discussions based on diversity and community outreach? Directors know they must act with the care that a person in a like position would reasonably believe is appropriate for members of a governing body in similar circumstances. Pandemic effects, demographic changes and technological disruption are taxing the best minds out there.

The board’s work is becoming much more difficult, due to factors including the changing market for digital and tech-based services that younger demographics demand. This complex competitive environment requires ever-increasing investments just to stay in the game. Such risks and challenges impact credit unions’ financial standing and for some, it’s about survival. It is increasingly difficult to chart a path forward.

Compared to the past, service-oriented credit union board members are facing mounting stress. Their decisions go to the heart of delivering safe, secure, state-of-the-art service to members. Many boards are finding that escalating investment requirements are forcing them to choose credit union merger strategies in order to maintain member service and safety.

These cumulative pressures are causing a growing number of credit unions to seek outside advisors to help board members carry out their duties and responsibilities as they navigate uncharted waters. It often takes a new, trusted voice to make sure that current and potential board members can satisfactorily answer the questions above. The duties of care and loyalty require it.

 Stuart R. Levine is Chairman and CEO for Stuart Levine & Associates LLC in Miami Beach, Fla.

Richard & Associates News Summary

 Weekly News Summary

Here are some things that were in the news last week. Please share these articles with your Supervisory Committee and Board of Directors. If you missed previous editions of the weekly news, summaries of those can be viewed at our archive.    Have a great week! Mike Richards, CPA

 

 

Economic and Industry Issues Knowledge is the key to effective corporate governance. Staying abreast of economic and industry issues affecting your credit union will prepare you for those responsibilities. Gain momentum and propel the board forward Read More Fed expects to keep supporting economy ‘for some time,’ minutes show Read More

 

Regulatory and Accounting Issues

 

Regulatory and accounting issues are changing all the time. Staying abreast of those changes is an important part of the corporate governance. Appeals court: Websites not subject to ADA Read More Interim final rule provides CUNA-League sought PCA flexibility Read More

 

Fraud Awareness As you will see from reviewing these articles, fraud can happen in any credit union. Staying vigilant is the key to preventing your credit union from being the next victim. Former Apple Store manager indicted in $1.5 million COVID relief fraud case Read More A fugitive for two years, Danville embezzlement suspect arrested after running from gunfire Read More Former credit union CEO pleads guilty to embezzlement, tax charges Read More 8 Best Fraud Prevention Tactics for 2021 Read More

Black Book forecasting an annual depreciation rate of 5% for used vehicles in 2021

LAWRNECEVILLE, Ga.—Black Book, in a joint report with Fitch Ratings, is forecasting an annual depreciation rate of 5% for used vehicles in 2021 as the effects of the pandemic continue to be felt.

The forecast comes after a record-low depreciation rate in 2020 at 2.0%.

Report Highlights:

Other forecasts from Black Book include:

• Manufacturing shutdowns impacted new sales, and this, coupled with the government stimulus payments and added benefits, led to an uptick in demand of used inventory
• On the other hand, lack of repossessions and delayed lease returns created used inventory shortages
• Full-size trucks and luxury segments in 2020 outperformed depreciation expectations, with full-size trucks appreciating 8.7%. Additionally, the premium luxury car segment depreciated a mere 8.1%, compared to 2019’s 25.9%
• Fitch said it believes auto loan and lease ABS (auto ABS) asset performance will be supported by strong used vehicle values containing loss severity, and resulting in positive asset recovery and residual value (RV) performance
• Fitch Auto ABS Rating Outlooks are stable for 2021 consistent with 2020, and reflect expected stable asset performance, transaction structural protections, and Fitch’s conservative establishment of transaction base case loss proxies
• Prime auto ABS asset performance demonstrated considerable resiliency in 2020, and both frequency and severity continue to contain loss levels

2020 Depreciation Trends

The annual depreciation rate on two-to-six-year-old vehicles fell by only 2% in 2020, a sharp contrast to the 16.8% annual depreciation in 2019, according to the forecast. Strength in the market was felt largely in Q3, due to the federal stimulus benefits and constrained new inventory levels.

In addition, Black Book and Fitch said moratoriums on repossessions and delayed lease returns kept the available used supply low and further fueled the appreciation of used vehicles.
The report stated the Compact Car segment fell sharply in the fall amid low fuel prices and increased new inventory levels, depreciating 10.6% in 2020. Full-size trucks and SUVs remained strong as continuing inventory shortages put a premium on used units.
The Black Book Used Vehicle Retention Index decreased 0.8% from 115.4 in January 2019 to 114.5 in January 2020. The Index began 2020 strong, but the effects of the pandemic began to be felt by the end of March 2020. Throughout the summer months, the Index climbed to a record 130.08 points before stabilizing and finishing the year at 128.8 points, up 13.7% compared to December 2019, according to the company.

A Look Ahead at 2021 Trends

According to Black Book and Fitch, as the economy continues to recover from the COVID-induced recession, wholesale and retail prices are expected to be strong in 2021 with projected annual depreciation of just 5%. The forecast predicts this will leave wholesale prices at the end of 2021 well above pre-COVID levels.

“Used inventory levels will remain tight throughout this year, contributing to the strength of the used market. New vehicle production and sales will return to some normality later this year, and we expect the wholesale market to return to typical seasonal depreciation in Q4,” Black Book said.

Open banking is the system of allowing access and control of consumer banking and financial accounts through third-party applications.

MIAMI–A “significant misunderstanding” over what open banking is all about is hampering its adoption, according to a new study of 2,000 global consumers by Mambu, a banking and financial services platform.

The Census wide survey, commissioned by Mambu, found that more than half (52%) of consumers have never heard of open banking and 61% have never used it, in spite of 80% of respondents using one or more mobile finance apps.

Open banking is the system of allowing access and control of consumer banking and financial accounts through third-party applications. 

“The research reveals the majority of customers don’t understand what open banking is, how it works and what it means for them,” said Elliott Limb, Mambu’s chief customer officer. “But it also reveals they do care about receiving better financial services that support their lifestyles – smart banking. If banks address this need and lack of understanding, it will help banks build customer loyalty and provide genuinely innovative, differentiating, revenue-generating services.”

The Big Disconnect

Mambu noted that open banking has witnessed an increase in adoption globally as a result of the COVID-19 pandemic, and the research indicates a “marked change” in attitude and priorities as a result of the crisis.

According to the survey, 52% said they wanted more control over their finances, while at the same time, 40% said the pandemic had changed their attitudes to privacy and 24% to data sharing.

Another boost came from the 41% who said they have had more time for research, Mambu reported.

• The survey also found respondents saying:
• I have needed to take more control of my finances (52%)
• I have had the time to do my own research and understand it better (41%)
• My attitude to privacy has changed since the pandemic (40%)
• I’m less worried about sharing data (24%)
• I have had more time to set it up (40%)

Existing Concerns Remain

The survey also found, however, existing concerns remain, with 48% of consumers claiming they are “scared” to use open banking and 53% still believing that open banking is a dangerous use of data sharing.

Mambu reported almost half of respondents claim that their banks did provide reassurance on the safety of open banking or provide information on what the numerous benefits are, with another 24% stating that, while it was explained, it could have been done in a better way.

“Banks must accept that open banking is still not a fully comprehended phenomenon so this is the starting point,” said Dmitrii Barbasura, CEO and Co-Founder, Salt Edge, a Mambu partner, in a statement. “We believe they need to invest time and effort in educating customers about the new possibilities they get access to, and also inform them about their rights and the high safety level covered by open banking.”

Change the Record

According to Mambu, demonstrating the opportunity for open banking, the survey revealed that 57% said they would be more likely to use it if their bank had more successfully implemented and promoted it.

When exploring further what consumers want from open banking, the survey shows that nearly half of respondents want instant digital money transfers; more than a third want aggregated bank balances at a glance; a third want tips on better money management and a quarter want money-saving suggestions for their bills.

What Consumers Like

• The survey found respondents liked various aspects of open banking, including:
• Instantly transfer money between different accounts (48%)
• See different account balances together at a glance (38%)
• Help boost my savings automatically calculating spending patterns and moving spare money into savings or investments (36%)
• Receive helpful hints about better money management (34%)
• Receive one overall monthly bank statement (34%)
• Allow access to banking data to receive automatic suggestions about money saving on bills and insurance (26%)

level the playing field between unregulated fintechs and credit unions.

WASHINGTON–With both credit union trade groups pressing Congress to bring fintechs under the same regulatory umbrella as other financial institutions, one of the key questions to be asking is what happens when things go wrong, according to NAFCU.

Credit union trade groups have called on Congress to ensure a “level playing field” between unregulated fintechs and credit unions. A number of fintechs have in the last year seen strong user growth into the millions of customers. Congress held a hearing on the issue last week.

“What we saw from the hearing is there are still a lot of questions,” said NAFCU EVP and General Counsel Carrie Hunt. “We are going to see more hearings on this issue. I think, ultimately, there is going to be a lot of disagreement as to what that regulation should look like. There is agreement that traditional financial providers can find value in partners, including fintechs, which can innovate quickly. It’s when they go one step further that begs the question around safety and soundness. We think credit unions provide the best option for consumers cradle to grave. These apps to move cash around quickly have a very finite purpose. The consumer really likes them until there is a problem, such as fraud, and then they end up going back to their credit unions. This is about a fair playing field.”

Regulatory Rollbacks’

Separately, the Biden Administration continues to roll back a number of Trump Administration rules and regulations, most recently around fair housing

Hunt said NAFCU is watching the moves being made by the Biden Administration, as it strongly supports a “deregulatory agenda.”

“If there is re-regulation, we want it to be necessary regulation,” said Hunt. “That’s how we view these rollbacks. We strongly support fair housing. Generally, it’s not the intent of regulation we have an issue with, its regulatory burden and whether it’s necessary to achieve those goals. Generally, there are other ways to achieve those goals.”

NCUA Chairman Todd Harper’s term officially expired on Monday?

ALEXANDRIA, Va.–New NCUA Chairman Todd Harper’s term officially expired on Monday, but he is not expected to be exiting the board anytime soon. Numerous NCUA board members have in the past served in a “holdover” capacity, often for extended periods.

Harper, the lone Democratic representative on the three-person panel, joined the board in early 2019 and was elevated to chairman earlier this year with the election of Joe Biden as president. Harper had previously served as director of Public and Congressional Affairs at NCUA and as chief policy advisor to the chairman from 2011 to 2017. He replaced as chairman Rodney Hood, whose term runs until 2023 and who previously served on the NCUA board from 2005-2010.

The newest member of the NCUA board, Kyle Hauptman, has a term that is to run through August 2, 2025. An NCUA board seat is supposed to be a six-year term, but other factors can affect the length of that actual service.

Both Hood and Hauptman are Republican appointees, which has created something of a delicate balance on the board. Prior to being named chairman, Harper cast the dissenting vote on a number of issues before the board, often losing 2-1. While he likely remains the minority vote on many of those same issues, the NCUA chairman does control the monthly board agenda, which gives him some leverage as the board members negotiate various issues.

Some ‘Uncertainty’

One source told CUToday.info they are concerned the status of the board creates some “uncertainty” over what to expect out of the agency.

At the time Harper was appointed chairman he said he and the agency will be paying particular attention to credit union liquidity in the second half of the year, while he separately called on the NCUA and the credit union community to take action to advance economic equality and justice.

NCUA Board to Meet

Separately, the NCUA board is scheduled to meet later this week with a very light agenda. The board is set to meet this week and is set to issue an interim final rule (IFR) on prompt corrective action (PCA). Also on the agenda, the board will receive a briefing on cybersecurity.

NAFCU EVP/General Counsel Carrie Hunt said the trade group is supportive of the flexibility NCUA is providing on PCA and is currently formulating its response to NCUA’s Advanced Notice of Proposed Rulemaking on investment authority.
 

The Trust for Credit Union’s (TCU) assets under management have surpassed $5 billion, setting an all-time record for the pool of institutional mutual funds for credit unions.

The Trust for Credit Unions (TCU) based in Washington, D.C., reported Tuesday that its two bond funds, the Ultra-Short Duration and Short Duration Portfolios, had total combined assets of $5 billion as of April 12, after attracting nearly $1 billion in new investments in a single month. It was nearing $3 billion in late November 2020.

TCU’s previous record was $4.1 billion, reached in March 2003.

CUNA has estimated that credit unions held $1.66 trillion in savings in February, 19.6% more than they held a year earlier. The gain of the previous 12 months ending February 2020 was 9.1%.

Surplus funds (cash plus investments) rose 48% to $653 billion as of Feb. 28, an increase of $210.5 billion over the previous 12 months.

As credit unions continue to seek competitive investment options to help them manage excess liquidity, TCU has attracted a record number of new credit union investors while continuing to assist their long-time institutional investor base.

TCU was founded in 1987 by credit unions to provide an option for diversifying their holdings of overnight and short-term funds from banks and the direct market. The funds were designed to be professionally managed and based on the cooperative values of credit unions.

The TCU Ultra-Short Duration Portfolio, which targets a three-month duration, had a 30-day yield of 0.23% as of April 12, while the TCU Short Duration Portfolio, which targets a two-year duration, had a 30-day yield of 0.48%. The yields reflect the 30-day effective yield, net of fees/expenses. Both funds offer next-day liquidity, feature no minimum or maximum investment amounts, and have no tiers.

The funds’ distributor is Callahan Financial Services, Inc., a subsidiary of Callahan & Associates, the Washington, D.C., credit union company.

“TCU has supported the industry’s investment needs for more than three decades, building a strong history of performance,” Jay Johnson, TCU president and Callahan & Associates’ chief collaboration officer, said. “We’re pleased to welcome new credit union investors as more cooperatives seek competitive options to put their excess liquidity to work.”

Created by leading credit unions with oversight by a board of trustees, TCU’s mutual fund options are professionally managed and based on the cooperative values of credit unions. ALM First Financial Advisors serves as the funds’ investment advisor, providing ongoing economic updates and educational resources for both current and potential investors.

Jason Haley, chief investment officer for ALM First, said the firm has managed short-duration fixed income portfolios for institutional investors for more than 25 years.

“We’re proud to share our knowledge and market insights regularly for the benefit of TCU investors and the entire industry,” Haley said.

Facial recognition to secure payments will exceed 1.4 billion globally by 2025

BASINGSTOKE, U.K.– The number of users of software-based facial recognition to secure payments will exceed 1.4 billion globally by 2025, from just 671 million in 2020, according to a new study from Juniper Research.

“This rapid growth of 120% demonstrates how widespread facial recognition has become; fueled by its low barriers to entry, a front-facing camera and appropriate software,” Juniper said, noting the research identified the implementation of FaceID by Apple as accelerating the growth of the wider facial recognition market, despite the challenges to facial recognition during the pandemic with face mask use.

The research recommends that facial recognition vendors implement robust and rapidly evolving AI based verification checks to ensure the validity of user identity, or risk losing user trust in the authentication method as spoofing attempts increase, Juniper reported.

Fingerprint Sensors

The new research, Mobile Payment Authentication: Biometrics, Regulation & Market Forecasts 2021-2025 PDF report, found fingerprint sensors will feature on 93% of biometrically equipped smartphones in 2025. This compares favorably to hardware-based facial recognition, with just 17% of biometrically equipped smartphones featuring these capabilities in 2025, Juniper stated.

“Hardware-based facial recognition is growing, but the ability to carry out facial recognition via software is limiting its adoption rate,” said research co-author Susan Morrow. “As the need for a secure mobile authentication environment grows, smartphone vendors will need to increasingly turn to more robust hardware-based systems to keep pace with fraudsters’ evolving tactics.”

A Limited Voice

According to Juniper, the research also found that the use of voice recognition for payments is increasing, from 111 million users in 2020, to over 704 million in 2025. The report identified that, at present, voice recognition is mostly used in banking, and will struggle to grow beyond this, due to concerns around robustness.

Juniper Research is recommending vendors adopt a multi-method biometric strategy, which encompasses facial recognition, fingerprints, voice and behavioral indicators to ensure a secure payment environment.