New iPhone Provides Launchpad for Biometric Apps

MADRID—Biometric apps may be the next to catch fire following the launch of the new iPhone 5S.

Fingerprint recognition is the main new feature in Apple’s latest smartphone, the first digital device with a simple, reliable fingerprint reader. This is used not only to unlock the phone, but also to authorize purchases from Apple’s App, iTunes and e-book stores.

Electronic handwritten signature apps work a lot like that. You write your signature on the touchscreen, using your finger or a pointer, and the app authenticates it. This technology, already used by some corporations to cut down on paperwork, is now making strides in the health care and financial services.

Now, the No. 1 issue in everybody’s mind when such technologies are discussed is security. This is especially the case after a group of hackers earlier this week showed how to unlock an iPhone using an image of a fingerprint instead of the real thing.

That isn’t great news for the industry, but not so bad as it appears either, says Antonio Vila, formerly with Microsoft and one of the founders of Smartaccess, a Spanish start-up that is looking to make a splash in the e-signature business.

“Fingerprint technology has been around longer and there are many levels of quality in sensors, it makes sense that it’s easier to crack for hackers if they are not using a expensive technology,” Mr. Vila says.

E-signature apps typically use various ways to ensure proper recognition, Mr. Vila adds. After all, the point isn’t that two signatures are exactly the same—no mere human can perform that feat—but that the app recognizes the way the user writes it, which would make the iPhone fingerprint hack harder to replicate.

Even Smartaccess, a small company that is only looking to hit €1 million ($1.3 million) worth of annual sales by 2014, has an expert calligraphist in staff. As a way to show how seriously it takes the security angle, the start-up uses an app at public events, which allows the public to try and fool the software by forging the signatures of famous people, such as Marilyn Monroe. There are prizes for the best forgers.

Smartaccess plans to make this app available at the Google Play online store soon, Mr. Vila says.

Jon Perera, vice president of EchoSign—a bigger company that was acquired by Adobe in 2011—calls security worries by potential users of e-signatures “misguided” and notes that such apps provide security safeguards that surpass ”anything possible with physical copies or fax transmissions.”

Generally speaking, the industry is succeeding in dispelling concerns. Smartaccess estimates the global growth in the wider e-signature market in 2011—the last year for which full data is available—was 48%.

The multifactor authentication market, where biometric methods like fingerprinting and e-signatures compete or combine with older ones such as passwords and PINs, is expected to grown well over 10% in coming years. In the U.S., the country where biometric systems are most commonly used, some 10% of businesses already use electronic signatures, and EchoSign says this may rise to 40% within two years.

Savings are the main reason for this. Softpro, a German firm, sees savings of up to $15 a document processed, and others say the cost of internal contract processing may be reduced by 50% to 75%, in part by dramatically reducing the need for couriers.