Mastercard Adopts Biometrics, Tokenization for Asia's Cardless Future

Published Date : 11/11/2025 

Mastercard is shifting its focus from physical payment cards to biometric and tokenization technologies, particularly in Asia. The company is leveraging advanced biometrics and digital identity solutions to transform the payment landscape. 

A Mastercard executive believes physical payment cards are becoming obsolete, driven by the rapid growth of biometrics and digital identity solutions across Asia. The company is steadily moving towards tokenization and biometric authentication for payments, especially online transactions.

The payment giant’s approach in Asia differs from its strategies in Europe and Latin America, where it is more centered around passkeys. However, the same fundamental shift towards digital and biometric payments is evident worldwide. While the future of biometric payment cards remains uncertain, with conservative adoption forecasts, Mastercard has launched luxury biometric metal credit cards in Bangladesh and is exploring palm vein biometrics in collaboration with Amazon.

Gautam Aggarwal, division president for South Asia at Mastercard, was candid about the future of payment form factors. Speaking at TechSparks 2025, he stated, “The card is not the form factor anymore.” He believes that existing physical form factors, including mobile devices, cards, and QR codes, will eventually become obsolete.

In India, Mastercard is navigating a highly dynamic fintech environment. The country’s Unified Payments Interface (UPI) processed nearly 200 billion transactions in FY25, an unprecedented volume. Domestic rival RuPay, backed by the National Payments Corporation of India, is leveraging UPI’s infrastructure to challenge global incumbents. Mastercard operates UPI-like systems in 10 to 12 other markets and is expanding into loyalty programs, cybersecurity, and behavioral biometrics. The company has acquired eight cybersecurity firms in the past five years to enhance its capabilities, with banks using its AI suite now seeing approval rates as high as 99.5 percent, even as fraud attempts rise.

Mastercard is also investing in “agentic commerce AI” technology, which enables transactions to happen without user interaction. This technology could transform retail, allowing RFID tags and AI systems to detect items customers are carrying and automatically charge them as they leave the store.

India’s market has significant potential. While mature digital economies process two to six times their GDP in payments, India’s $4.4-trillion economy sees just $3.5 trillion in digital transactions. Aggarwal emphasized that Mastercard’s focus is on digitalizing new use cases rather than competing in existing spaces. The company has invested in Indian start-ups like Razorpay and holds stakes in Pine Labs and Slice, allocating around $300 million annually in strategic investments.

In South Korea, a growing number of young consumers are adopting biometric payments. Toss FacePay, a face biometrics-powered payment service, is gaining popularity. Despite a lengthy registration process, users find the system convenient and fast. Toss aims to expand the service across the country, targeting everyday venues like cafes, cinemas, and hospitals. The trend is accelerating the decline of traditional card usage among people in their 20s, causing a significant drop in card spending and hurting credit card companies’ bottom lines.

Cambodia’s digital wallet system, Bakong, is also experiencing rapid uptake. The central bank-backed app has integrated with 69 financial institutions and serves over 30 million users. The adoption of KHQR, a standardized QR code for payments, has surged to 4.9 million merchant accounts, while e-wallet accounts have reached 22.9 million. The National Bank of Cambodia (NBC) reported significant growth in digital transactions, fueled by widespread mobile and internet connectivity. The association is working to promote digital literacy and combat online fraud through financial education campaigns.

Mastercard’s strategic shifts towards biometrics and tokenization reflect a broader industry trend towards more secure, convenient, and seamless payment experiences. 

Frequently Asked Questions (FAQS): 

Q: What is Mastercard's approach to biometric payments in Asia?

A: Mastercard is focusing on biometric authentication and tokenization for payments, particularly in Asia, to replace physical payment cards. This includes the use of face biometrics, palm vein biometrics, and behavioral biometrics.

Q: How is Mastercard adapting to the fintech environment in India?

A: Mastercard is navigating India's dynamic fintech environment by operating UPI-like systems, expanding into loyalty programs, cybersecurity, and behavioral biometrics. They are also investing in Indian start-ups and leveraging their AI suite to enhance fraud detection and approval rates.

Q: What is Toss FacePay and how is it impacting South Korea's payment landscape?

A: Toss FacePay is a face biometrics-powered payment service gaining popularity among young South Koreans. It is convenient and fast, leading to a decline in traditional card usage and challenging credit card companies.

Q: How is Cambodia's Bakong digital wallet system driving the shift to digital payments?

A: Bakong, a central bank-backed digital wallet system in Cambodia, has integrated with 69 financial institutions and serves over 30 million users. It has significantly boosted digital wallet adoption, particularly among youth, through initiatives like the Youth Bakong programme.

Q: What are the potential risks and challenges of digital payments, and how are they being addressed?

A: The rise of digital payments brings new risks such as online fraud and cyber threats. Financial institutions and associations are addressing these challenges through digital literacy campaigns and financial education to promote safe usage of digital payment systems. 

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