Passkeys in Emerging Markets

Passkeys are quickly becoming the global standard for secure authentication, replacing vulnerable methods like one-time passcodes and SMS-based verification. While adoption has gained traction in developed markets, emerging markets are now demonstrating unique opportunities for passkey deployment. These are regions where users often interact with multiple platforms daily, moving between mobile apps, web portals, and in-person or online payment flows.

Why emerging markets matter

Emerging markets are home to some of the fastest-growing digital ecosystems in the world. Mobile penetration is high, but users are not always tied to a single device or channel. A person may start a transaction in an app, confirm it through a browser, and later continue the journey in a physical store. This fluid behavior demands an authentication method that can seamlessly bridge experiences.

Passkeys are designed for exactly this. By being device-bound, they ensure that authentication remains both secure and consistent, regardless of whether the customer is engaging in an app, on the web, or at a payment terminal.

Omni-channel authentication as a differentiator

An omni-channel approach is especially valuable in these markets. For consumers, it reduces friction by removing the need to remember or re-enter credentials across devices. For businesses, it enhances trust by offering a unified security experience that works across every digital touchpoint.

In places where fraud risks are higher and digital trust is still being built, device-bound passkeys can deliver:

• Higher transaction approval rates
  
  
• Lower abandonment in payment flows
  
  
• A trusted experience that mirrors global best practices
  

Building trust and convenience

In emerging markets, convenience often drives adoption as much as security. If a system is too difficult to use, consumers will abandon it in favor of less secure but more familiar alternatives. Passkeys strike a balance by providing bank-grade security without adding extra steps for the user.

This balance helps service providers differentiate themselves in crowded ecosystems while ensuring compliance with evolving regulations that increasingly demand stronger forms of authentication.

FAQ

What makes passkeys better than SMS one-time passcodes in emerging markets?
Passkeys are resistant to phishing and SIM-swap attacks, which remain prevalent in regions where telecom fraud is common. They are also faster and do not rely on network connectivity.

How do device-bound passkeys work when users switch devices?
New devices can be registered and bound during onboarding or through secure recovery flows. This ensures users can continue their journey without reverting to weaker fallback methods.

Why is omni-channel support important for financial services in these regions?
Because customer journeys often span multiple devices and platforms. Omni-channel support ensures authentication feels seamless and consistent, boosting both trust and completion rates.

Are regulators in emerging markets supporting passkeys?
Yes. Regulators in regions such as Southeast Asia, Latin America, and Africa are increasingly emphasizing strong customer authentication and moving away from outdated OTP-based models.

Sources

• https://fidoalliance.org/passkeys/
  
  
• https://www.weforum.org/agenda/2023/11/digital-payments-emerging-markets/
  
  
• https://www.imf.org/en/Blogs/Articles/2022/09/13/fintech-is-fueling-financial-inclusion-in-emerging-markets
  
  
• https://www.nature.com/articles/d41586-023-00534-3

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