On a busy Friday afternoon at a supermarket in Moscow, customers were waiting in line to pay for their groceries. Most planned to use credit cards or cash, unaware that they had a new option: to pay by simply looking at the camera.
In March, X5, Russia’s biggest food retailer, began testing the “Pay with Your Face” program in around 170 stores in the capital. Developed in partnership with Visa and Sberbank, Russia’s biggest bank, the program is open to Sberbank cardholders — as many as 50 million people — with 400,000 currently using it, according to Sberbank. It works via a high-resolution 3D camera and confirms an individual’s identity by scanning 200 facial points and taking “into account a person’s height and changes in appearance,” according to X5. This biometric data is then transmitted via “highly secure, encrypted channels” back to Sberbank.
X5, which has a market capitalization of over $8.6 billion and is listed on the London Stock Exchange, first began incorporating biometric payments technology into self-service checkout terminals back in 2019. After initial tests, it increased the number of terminals last year and, this year, is planning to install the systems in at least 6,000 devices in 1,500 stores across Russia. While other banks and retailers have experimented with this technology in the past — including the Azbuka Vkusa supermarket chain, which introduced biometric payments in 2019 — this is the biggest pilot in Russia to date that relies on biometric tech alone.
Across Russia, some of the country’s biggest retailers, banks, and even Moscow’s subway system are moving forward to embrace biometrics and contactless payments systems. At the beginning of April, Sberbank signed an agreement with Rostelecom, the country’s largest telecom operator, to accelerate the introduction of biometric technologies into the private market and government services, according to Rostelecom President Mikhail Oseevskiy. Per the business daily RBC, the Russian government may also join in on the venture.
Yet X5’s experience showcases the balance that Russian companies have to strike. On the one hand, industry players want to unveil cutting-edge technology ahead of domestic and international rivals; on the other, they have to ensure that these new systems will work effectively and are embraced by customers. A closer look at the technology shows that these objectives can be at odds.
“I’m convinced that contactless biometric payment solutions will very soon be used universally, and this payment method will become as customary as paying with a bank card or a smartphone,” said Igor Shekhterman, CEO of X5 Retail Group, in a statement on March 9, describing the technology as “fast, convenient and secure.”
But in practice, widespread adoption is still a work in progress. Many consumers need to be trained in the basics of how to use the system. A month into the trial, X5 said that, with partners, they are “discussing implementing some educational programs to help customers learn more about this payment technology.”
Here is how it works: After a customer scans their groceries, they can select “pay with a glance” as a payment method. The screen then shows three QR codes but offers scant information about what to do next. Once the QR code is scanned, the customer must open Sberbank’s phone app, click “pay,” and look into the camera. The system will then search for their biometric data.
Vladimir, a hobbyist coder and customer service employee at a store operated by X5 in Moscow, described the biometric checkout software to Rest of World as “total shit.” He added, “in all the time that I worked here, I’ve only seen one person use it to pay for their purchases.”
Another major concern is privacy. Regulators in Russia are also still deciding how biometric data can be used, and as cybersecurity experts and privacy activists have pointed out, many markets, including Russia’s, lack the infrastructure to ensure that data can be properly secured. X5’s biometric rollout faced no significant pushback from any regulators — which is notable, as Western companies are still struggling to implement facial recognition programs in the U.S. and Europe — but company representatives say that security has not been compromised. “None of the project partners or any other entities can access this data,” said Ivan Melnik, director of Innovation at X5 Retail Group, in an interview. In an email to Rest of World, Sberbank also stated that their “biometrics data is aggregated, processed, and stored by Sber alone.”
And X5 is not the only major Russian outlet investing in biometric systems.