Panera Bread tests Amazon's palm-scanning technology in St. Louis

Panera Bread is piloting Amazon’s palm-scanning technology in St. Louis to offer customers a faster way to connect to their loyalty program and pay.

The bakery-cafe chain, which has long been considered a leader in restaurant technology, is the latest restaurant to use what the tech giant has dubbed Amazon One. It’s already been implemented in dozens of Amazon-owned Whole Foods locations, Amazon Go stores and some stadiums and arenas.

Panera has more than 2,000 locations and its loyalty program has more than 52 million members, representing a big expansion opportunity for Amazon One. A representative for Amazon declined to share data on existing signups for the palm-based payment system.

For now, Panera’s starting small, with just two company-owned restaurants in its hometown of St. Louis.

“We think the payment plus loyalty identification is the secret sauce that can unlock a really personalized, warm and efficient experience for our guests in our cafes,” Panera Chief Digital Officer George Hanson told CNBC.

Panera is looking to expand the test to 10 to 20 more restaurants over the next few months, including some operated by franchisees, according to Hanson.

The palm scanners are located near the restaurant’s registers. To use them, customers need to link their loyalty program accounts to Amazon One, which they can do at home or inside the restaurant. They’ll also need to enable loyalty identification and payment for their accounts.

Amazon has faced some backlash from consumers and privacy experts for its use of biometrics, which use biological measurements to identify someone. An Amazon Go customer filed a lawsuit Thursday in New York, alleging the retailer broke the city’s law that requires it to post signs informing customers that it’s using facial recognition.

Security experts have warned that even palm scans can be a risk because that data is stored in the cloud. Last March, Red Rocks Amphitheater in Colorado dropped Amazon One from the venue after privacy groups pushed it to reconsider.

But Hanson said Panera chose Amazon’s technology for three reasons: it’s contactless, customers have to opt in, and a person can’t be identified by their palm alone.

“All of those things are the reasons why we think this particular technology solution is safe, secure and very guest centric,” he said.

For its part, Amazon says that palm images are encrypted and sent to a secure, “custom-built area in the cloud” where the company creates a unique palm signature.

This marks Amazon’s second tech collaboration with a large restaurant company. Starting in late 2021, it started opening pickup cafes with Starbucks using its Amazon Go cashierless technology. Like Panera, the coffee chain has been looking for new ways for customers to pick up their food and drinks quickly and conveniently.

Panera’s tech investments and popular loyalty program may make it more attractive to investors. The restaurant company is currently privately owned by JAB Holding, the investment arm of the Reimann family.

Last year, JAB attempted to take the chain public again through a deal with restaurateur Danny Meyer’s special purpose acquisition company and an initial public offering, but it fell through due to rocky market conditions.

However, The Wall Street Journal reported earlier this year that Panera is once again eyeing an IPO, as long as investors have an appetite for one.