Digital transformation and facial recognition

Issue 4 2023 Infrastructure


Aadiel Ayob.

Digital transformation has become essential for boosting productivity, fostering value creation, and enhancing security. As part of a staged approach to digitalisation, South African companies are implementing insights-driven data, cloud computing, artificial intelligence (AI), and cybersecurity.

In an era of thriving digitisation, which continues to contribute significantly to our economy, facial recognition technologies, also known as digital identity verification, has become a vital tool to strengthen the security of customers and their data. By using facial recognition software, businesses can verify customer identities quickly and securely and protect their customers from costly fraud attacks. As each individual is unique, the software provides an ideal way to verify the identity of an individual by using methods and technologies that identify them based on physical or behavioural characteristics.

Traditionally used by banks and e-commerce companies, now any organisation can use face recognition to overcome many of the obstacles associated with more traditional and document-based techniques for validating identity. Digital solutions also provide extra security and convenience for engaging with individuals and validating their identities from any location. Interestingly, many organisations may have embraced this technology more fully during the COVID-19 pandemic when lockdown measures were enacted.

Mobile authentication

South Africa’s banking sector has introduced facial biometric technology for their clients to authenticate certain transactions through facial scans on their phones. This method leverages facial mapping technology to verify and identify users when linking a device (such as a smartphone) to their banking applications. The users face then becomes a way to gain access to the app, providing an additional layer of security.

The aviation industry has also chipped in on the investment of facial recognition technology. The introduction of passenger digital identity technologies is based on digital identity tokens, allowing passengers to enter the airport and automatically go through all the necessary processes without having to spend time on constantly presenting their flight and ID documents.

Facial recognition technologies can have a significant impact across a wide range of industries. The technology can be applied to a variety of industries, including airports, to provide a holistic view of airport functions and operations by integrating identity, capability, and activity information. Using this technology, airports can enhance passenger experiences, manage restricted areas, aid inContact investigations, identify individuals of interest in collaboration with the police department to curb criminal activity, automate boarding processes, detect face masks, and manage employees better.

Vertical markets solution

Facial recognition also presents an opportunity to reinforce cybersecurity, as cyberthreats continue to surge in South Africa.

As an ecommerce solution, it provides digital authentication for online transactions and customer verification. The result is a reduction in online fraud, transactional fraud, identity fraud, and reduced onboarding friction and timeframes, which improves client engagement and security.

The use of facial recognition technologies in the medical field can substantially reduce the risk of medical aid fraud, insurance fraud, and financial aid fraud. It is estimated that the industry loses between R22 billion to R28 billion a year to fraud, waste and abuse (FWA), according to the Council for Medical Schemes (CMS).

Furthermore, a payroll authentication system can utilise facial recognition technologies to curb ghost employee fraud. The payroll recipient is validated through facial biometric authentication against the organisation's database to determine if they are an employee of the organisation.

In the retail sector, facial recognition can be used to improve point of sale efficiency, reduce customer friction, and drive transitional security. The result is less friction at checkout, less fraud, less card scheming, better marketing analytics and promotions, and fewer customer complaints.

Despite the slowdown in economic growth and moderating interest rates, we anticipate that businesses will continue to invest in digital transformation activities in 2023, driven by the increasing adoption of Generative AI. With its ability to create new and innovative solutions autonomously, Generative AI will enable businesses to drive productivity improvements and cost savings, particularly in times of inflation. As a result, we believe that many businesses will increasingly rely on Generative AI to fuel their digital transformation efforts, leading to a faster pace of innovation and growth in the industry.




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