The Cost of Passwordless Authentication: Technologies, Trade-offs & ROI

8 May 2025

Going passwordless isn’t as simple as flipping a switch. It involves navigating different technologies, understanding trade-offs, and calculating real returns. This blog breaks it all down, so you can make smarter decisions about what to adopt and why.

Comparing Passwordless Technologies

Passwordless authentication comes in many forms. Not all are equal when it comes to security, cost, privacy, or usability.
Below is a breakdown of common passwordless authentication methods, outlining their pros, cons, and overall return on investment (ROI).
These solutions offer varying benefits – but not all solve the most important question: is the right person behind the authentication event? 

Understanding the Trade-offs

Every authentication method involves a trade-off between security, privacy, usability, cost, and integration effort. The challenge is finding a solution that doesn’t compromise one to achieve another.
Let’s take a closer look at how each method stacks up:
  • SMS OTPs and Email Links are quick to deploy and familiar, but they don’t verify who is behind the device. If a phone or email account is compromised, the attacker can access everything. They’re also vulnerable to phishing and interception, and in the case of SMS, come with recurring costs.
  • Hardware Tokens offer strong phishing resistance, especially in workforce settings. However, they don’t verify identity and can be lost or stolen. At scale, distribution and replacement costs become a major issue.
  • App-Based Authentication balances usability and cost but still doesn’t verify the person behind the device. If malware is present or the device is compromised, attackers can still gain access.
  • Passkeys improve phishing resistance and deliver a smoother experience across devices. However, they're still tied to the underlying OS and don't give visibility into who registered the biometric or owns the account.
  • Call Center Verification is often used as a fallback for exceptions. While it adds a human layer, it’s slow, expensive, and highly vulnerable to social engineering. It's also one of the least scalable and most frustrating experiences for users.
In contrast, biometric authentication—when implemented correctly—offers:
  • Real identity assurance by confirming a living person is present.
  • Fast, seamless experiences that reduce login friction.
  • Lower fraud risk by stopping impersonation at the source.
That said, not all biometric systems are equal. Some use server-side storage or split biometric data across multiple servers (a method known as sharding). These models may seem decentralized, but they still expose users to privacy risks—especially if one entity controls the infrastructure.

Why Zero-Knowledge Biometrics Are Different

Keyless takes a fundamentally different approach with Zero-Knowledge Biometrics™ (ZKB), powered by secure Multi-Party Computation (MPC).
Instead of storing or reconstructing biometric data, ZKB verifies a user’s identity by comparing transformed, cryptographic representations of their biometric. This happens across secure, distributed systems—without anyone, including Keyless, ever seeing the original biometric data.
This approach addresses the key trade-offs other systems struggle with:
  • Privacy is preserved – No biometric templates are stored or shared.
  • Security is enhanced – Deepfake-resistant liveness detection and device trust prevent spoofing.
  • Usability is seamless – Matching takes under 300 milliseconds across platforms and devices.
ZKB provides the security of centralized systems, the privacy of local authentication, and the usability of both—without any of the risks. It also allows for secure account recovery and cross-device authentication without re-enrollment, a major advantage over device-native biometrics.

Breaking Down the ROI

Passwordless authentication often delivers faster ROI than expected—especially when switching from legacy systems.
Here’s what organisations typically save:
  • Helpdesk volume drops – Password reset calls and account lockouts can decrease by up to 60%.
  • SMS OTP costs eliminated – Businesses save on every message previously sent per login or transaction.
  • Fraud losses reduced – True identity assurance prevents account takeovers, synthetic identity fraud, and social engineering attacks.
  • Operational efficiency improves – Faster onboarding, reduced reliance on manual re-verification (e.g. re-KYC), and smoother recovery flows save both time and money.
But the return isn’t just financial. Removing friction improves conversion rates, boosts retention, and drives user satisfaction—especially on mobile, where speed and simplicity matter most.
Keyless clients consistently report ROI within 12 months of deployment, with measurable improvements across both security and user experience KPIs.

Integration Time Matters

Authentication is only effective if it fits within your systems. Complex solutions that take months to deploy can derail security projects before they start.
Keyless supports flexible deployment options, including:
  • SDKs for iOS, Android, and web browsers.
  • SSO integration for workforce access.Cloud, on-prem, or hybrid deployments.
This ensures faster time-to-value, regardless of your technical environment.

Final Thoughts

Biometric authentication isn’t just about replacing something broken – it’s about building something better. And when done right, it doesn’t just improve security – it reduces cost, improves user trust, and enhances the overall experience.
Technologies like Zero-Knowledge Biometrics show that we no longer have to choose between security, privacy, and usability. We can have all three – while delivering measurable ROI along the way.
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