Enterprises have long used passwords as a deterrent against bad actors trying to access their systems. However, with the many changes transpiring in the digital world, passwords have become a gateway to security risks and a source of frustrations among modern consumers.
Often, organizations combine passwords with a secondary login credential like an SMS code or email authentication to increase their digital defenses. Still, this multi-factor authentication (MFA) option is weak and susceptible to circumvention tactics. It also adds friction when logging in, making the process more cumbersome for users. As firms continue to rely on these inefficient and sometimes ineffective authentication methods, they end up spending more than necessary and still fail to address present security risks.
Password Reset Costs
Compromised accounts and forgotten login credentials often cause account owners to trigger a password reset request. In other cases, some companies implement a forced password expiration policy, requiring end-users to change their passwords within a specific interval such as every 30, 60, or 90 days.
Password resets are the most common helpdesk issue IT staff deal with, constituting about 20% to 50% of IT helpdesk tickets yearly. According to Forrester Research, enterprises spend about $70 per password reset and invest $1 million annually on personnel and infrastructure to support this operation.
Additionally, password resets also result in other costs such as productivity time. A report from the Ponemon Institute reveals that about 12 minutes per week is spent on entering and/or resetting passwords, which can cost about $5.2 million yearly for enterprises with 15,000 employees.
If businesses want to reduce costs associated with password resets, they must adopt a passwordless system like FIDO2’s cryptographic authentication. This solution uses a more robust combination of login credentials like something you own (cryptographic keys) and something you are (facial or fingerprint device-based biometrics), which cannot be bypassed with tactics used against knowledge-based authentication. By replacing passwords with FIDO login, enterprises can spend their funds on more worthwhile investments for their operations.
Fraud Loss Associated with Passwords
Year after year, the Verizon Data Breach Investigations Report cites login credentials obtained either through phishing efforts by hackers to entice users to ‘reveal’ passwords or stolen credentials as the greatest contributors to data breaches. In their 2021 report, Verizon noted that worldwide COVID-19 shutdown and stay-at-home orders caused a surge in phishing attempts that resulted in phishing being present in 36% of all breaches cyberattacks targeting users’ credentials, up from 25% in 2020.
With FIDO2 passwordless login, organizations can better mitigate fraudulent attacks to prevent significant financial losses. Moreover, they can adhere to including the Payment Services Directive 2 (PSD2) Compliance for Strong Customer Authentication.
Abandonment Rate due to Password Hassles
In the fast-paced environment of the modern world, consumers expect businesses to deliver a seamless user experience on their digital platforms. If enterprises continue to use passwords in their network, they can quickly drive away customers and lose revenue.
According to research from the Baymard Institute, shopping cart abandonment rate from consumers ranges from 55% to 84.27%. Moreover, up to 37% of new users will drop a check out if they are forced to create an account, while 18% of existing account owners will abandon because of frustrations due to passwords.
The research continues that if enterprises optimize their checkout strategies, they can increase conversions by 35.26%, equivalent to about $260 billion annually. Through FIDO2 cryptographic login, companies can make the authentication process faster and more convenient while ensuring security among users. Accordingly, passwordless login helps companies acquire new customers and encourage repeat business with existing clientele.
Although passwords were intended to keep accounts secure, they remain ineffective in blocking fraudulent attacks and succeed only in reducing a business’s profit. Enterprises often waste large sums of money on password resets, help desk support, fraud losses, and cart abandonment from customers.
Ideally, companies should be spending their funds on operations that can drive growth and strengthen their brand reputation. With hackers always seemingly a beat ahead, next-level authentication is a must. When evaluating password replacement solutions, organizations must work with reliable providers that can meet their needs – from cost-effectivity to enhance security and customer satisfaction. Critical to secure deployment of passwordless solutions also is the need to ensure that the person who registers a device or adding a second device is truly the account owner.
AuthentifID™ by authID delivers trusted FIDO2 strong customer authentication for passwordless login and transaction authentication tied to a trusted identity. During device registration, AuthentifID™ leverages authID’s seamless biometric identity proofing service to scan an identity document and take a selfie to establish a digital chain of trust between biometrically verified individuals, their accounts, and their devices. This digital chain of trust increases confidence that only the true account owner is accessing the system and provides an easy self-service solution when the user wants to add a second FIDO2 device or replace their primary FIDO2 device.
authID’s Verified™ also confirms consent to specific transactions and biometrically authenticates a person’s identity in real-time for higher-risk transactions and acts as a powerful account recovery tool when a customer needs to login from an unregistered device or replace a lost device.
Schedule a Demo with authID
authID.ai is a leading provider of an Identity as a Service (IDaaS) platform that delivers a suite of secure, mobile, biometric identity solutions, available to any vertical, anywhere. Enterprises can reduce operational costs while ensuring security and seamless customer experience with authID’s FIDO2 passwordless authentication solutions.
Contact authID today at 1 (516) 778-5639 or click here to schedule a demo.