A New, and Potentially Problematic, Way to Pay

Photo by Chloe Wang

Ariel Andres

Contributing Writer

The COVID-19 pandemic has spurred the growth of a variety of emerging technologies in the United States (U.S.)., one of which being facial recognition payments(FRP). PopID, a technology company based out of Pasadena, CA, is attempting to take advantage of that trend with their FRP product, PopPay, but customer sentiment towards this kind of technology — along with a lack of full transparency — may become roadblocks for their future growth.

In essence, PopPay allows consumers at retail stores and restaurants to use their face to make payments without the need for their phones or wallets. Here’s how it works: customers first create an account through the PopID website. hen, they enter their payment information that will be used for future transactions, followed by a selfie. At a retail store or restaurant, a PopPay camera takes a picture of the customer, and the payment is finalized.

Despite their recent $15 million in series B funding and relatively low competition, there are still major obstacles to overcome in regards to how consumers view this kind of technology. There seems to be three chief concerns surrounding FRP: mass or constant surveillance, the leaking of financial data, and the inappropriate use of private data.

The first concern, regarding mass or constant surveillance, has been exacerbated in American culture ever since Edward Snowden leaked government surveillance programs in 2013. Initially, Americans were divided on whether the programs were justifiable, but they have become increasingly wary of mass and constant surveillance since then. A Pew Research study from 2018 found that a majority of Americans were concerned about mass surveillance. That fear also extends to big tech companies such as Facebook and TikTok. A WhistleOut poll indicated that 87 percent of Americans believe that at least one tech giant is spying on them.

Clearly, the feeling of having all your movements tracked and reported to a relatively unknown company is eerie, and the mistrust or wariness that ensues may be a blow to PopID’s customer loyalty.

The second concern, the leaking of financial data, has to do with the misuse of private information. Consumers are worried about the troves of data that big tech companies are constantly collecting and how that data is being used. Another Pew Research Poll reported that 79 percent of Americans are not confident that companies will admit mistakes and take responsibility if they misuse or compromise personal information. Since PopID is still a relatively new company, it would make sense that students are skeptical of it.As one student put it on a University of California, Santa Barbara (UCSB) subreddit post, “As if I would want a bunch of IV frat bros having access to photos of my face and financial info anyways.”

As one student put it on a UCSB subreddit post, “As if I would want a bunch of IV frat bros having access to photos of my face and financial info anyways.”

Even in China, where FRP is much more abundant, users are concerned about their privacy. One study showed that an overwhelming majority of Chinese consumers are worried about their private data being misused or leaked.

Furthermore, PopID does an abysmal job of being transparent with how they use their data. Browsing popid.com does not offer any clear indications about how they manage their data or if it gets shared with any third parties. Their top link bar does not include a privacy section, nor does any other part of the website. In order to access that information, one needs to Google their privacy policy. Even then, it is a document filled with legal jargon that is unclear to regular consumers, inclining them to turn away.

One key point from their privacy policy states that PopID reserves the right to share personal data with “businesses that the consumer elects to use PopID to authenticate identity.” And if users don’t explicitly request deletion or limited disclosure of their information (either by emailing info@popid.com or using a web portal), PopID stores the data for three years after the last transaction.

The third concern customers may have is about private information being misused and potentially accessed by hackers. Financial and technology companies are regularly popping up on the news for having their database hacked and having millions of data points leaked to the public. The most notable were the recent leaks from Facebook and Twitch

Something to keep in mind about security is that, in general, data stored in local servers tend to be less safe than data stored in the cloud. According to their website, PopID keeps their customer data on the cloud, and it is all encrypted — increasing the layer of protection for customers. Therefore, customer data is expected to be fairly safe from being leaked. Nevertheless, even the safest data storage is still prone to being infiltrated.

PopID is in a special position, as facial recognition payment is still an emerging market in the U.S. The low number of competitors, coupled with a strategic marketing plan, is a recipe for rapid growth. Moreover, the pandemic has introduced the desire for contactless payments. As such, PopPay can readily fill that need.

Currently, their marketing plan seems to revolve around restaurants and retail stores surrounding college campuses in Southern California. Some of these college campuses include UC San Diego (UCSD), the University of Southern California (USC), and our very own UCSB. In addition to partnering with local restaurants and retail stores, they also began sponsoring collegiate athletes, as shown on their Isla Vista (I.V.) Instagram page. Finally, they have partnered with over 100 brands, including Panasonic and OpenOptions, and they have continued to grow their partnerships at a rapid pace. In short, the personal data stored by PopID seems to be relatively safe from leaks and attacks, but the fact that they are not more transparent about how they use information is potentially a sign of practices that consumers may not be too pleased with. Since PopID has been expanding into local I.V.restaurants, nearby students should be wary of how their personal data may be used.