CEO Karim Jindani hopes his touchless biometric can disrupt the entire financial industry.
CEO Karim Jindani hopes his touchless biometric can disrupt the entire financial industry.

BACK in 2015 when the telcos were ordered to get all their customers’ biometrics verified, it took me a month after they blocked my number to finally go to a customer service and restore my SIM card. If there was a simpler way, all of that delay could have been avoided. There just might be — enter InstaScan. Better late than never, I guess.

InstaScan is a Karachi-based tech startup that lets you do biometric authentication without any hardware. All you need is a smartphone. Put your finger in front of the rear camera, the software will automatically capture a picture and then process it into an Nadra quality fingerprint image.

To be clear, this is not a direct business-to-consumer product and can only be accessed by InstaScan’s partner companies which have adopted it. So rather than having its own app, the solution is integrated with other apps where it works on SaaS (software as a service) model.

While the potential use cases for this tech are numerous — from banks to telcos, so far it’s limited to one: branchless banking. The company has paired up with JS Bank so every time there is a customer signing up for their mobile wallet, they need to authenticate biometric data using InstaScan (which has been integrated into the JS phone app).

The way it works: you enter your CNIC number and capture fingerprint(s) using InstaScan, which will be sent to the bank to be then forwarded to Nadra servers where the details will be verified (or not).

Even though the process hardly takes a minute, it is nonetheless indirect since InstaScan relies on Nadra authentication — and as it turns out, they don’t have access to the authority’s data. “Nadra by law can only give access to telcos and financial institutions, and we are neither. So our process has to be routed through the bank, which is authorised to access Nadra data,” says CEO Karim Jindani.

What’s worse is that it restricts the startup to only these two sectors, leaving rest of the potential clients underserved for now. “We have finalised everything with IGI insurance but none of us has access to Nadra data, so the entire deal is still hanging. Hopefully something will move ahead there,” he tells Dawn.

All of the branchless banks or digital wallets have come up with their own ways for customer authentication, ranging from original CNIC pictures to one-time passwords (OTPs). “Most have a team dedicated to vetting whether the uploaded IDs are genuine or not while OTPs can be routed to another device with a bit of hassle. So it’s not too scalable or sophisticated tech-wise. InstaScan, on the other hand, is more secure and quick,” says the CEO.

InstaScan started out in 2016 when veterans from fintech and payments joined hands and launched Paysys Labs, a technology company working on mobile app development and other digital solutions for mainly financial industry. Soon after, the company secured a $100,000 grant after winning a fintech challenge. But even two years after that seed capital, Karim is not looking for investment. “We have a number of offerings at Paysys Labs so there are multiple streams of income, which gets us by. And InstaScan is a self-sustaining unit,” he says.

As for InstanScan’s source of revenue, it works on a usage-based model with a certain fee per verification. “It’s pay as you grow,” he says. What’s that? Basically a sales model that lets clients buy additional capacity as they scale up.

Given the pace of tech advancements and regulatory expansions, most industries are inevitably gravitating towards the biometric authentication. In fact, post Bank Islami cyber attack, the State Bank of Pakistan has toughened up regulatory measures mandating all banks to get their customers’ biometric data by June 30, 2019. And Karim is optimistic this is the right opportunity to strike and grab a market, with his team all lined up for pitching InstaScan to potential customers.

But there’s a catch: SBP notification requires the biometric authentication to be done at the branch. And that, to an extent, kills the logic behind InstaScan which has largely marketed itself as a ‘remote’’ biometric solution. Going to the bank would beat that purpose.

Not entirely, though! According to Ashar Niaz, a Business Development Executive at Paysys: “This ‘at the branch’ thing does complicate things for us but we are trying to find a way around. There’s a significant overseas Pakistani population with accounts here which would go dormant if they don’t physically come for authentication, so hopefully InstaScan could be used there.”

In fact, that’s a market the CEO has his eyes on. “Some of the Nadra forms for overseas Pakistanis require them to actually download the thing, stamp their fingerprints and send it back which is insane. Our solution can speed that process and most importantly, avoid the need to look for a stamp pad in the streets of USA,” Karim says.

Let’s see if a couple of years down the lane, we’d be living in a world where we won’t have to get out of our bed to authenticate our existence.

The writer is member of staff:

Twitter: @MutaherKhan

Published in Dawn, December 16th, 2018