Biometric Authentication and Identification Market

Market Overview

The global biometric authentication and identification market had a revenue share of USD 4,135 million in 2021, presumed to reach USD 14,225 million, expanding at a CAGR of 16.7% during the forecast period.

The economy has been significantly shaped by technological advancements from paper to electronic to digital to biometric. This progression has improved the operating capacities of numerous industries, including the automotive, manufacturing, and construction sectors, in terms of better safety measures, connection, cost savings, and user convenience. The term "biometric" refers to detecting the distinctive physical and behavioral traits a person receives at birth. Biometric technology is the art of electronically recording, processing, and measuring an individual's features and comparing the resulting records to existing ones. Nations and the global industrial community are taking notice of biometric-based systems. They are a technology that neither business nor government can manage to disregard. It is thought to serve as a deterrence to those with malicious intentions.

In a variety of situations, biometrics has aided in providing security services. It has assisted in identifying known suspects moving through congested security areas like airports, train stations, and other places. Terrorist assaults have decreased due to the creation and application of cutting-edge novel technology and concepts, like biometrics, in the domain of anti-terrorism protection. The consumer goods sector, including smartphones, laptops, and tablets, has a much greater demand for biometrics, significantly impacting the biometric industry's growth. This paradigm shift affects both the consumer and enterprise markets. Additionally, the banking and financial industries have seen a substantial transformation thanks to the development of smartphone technology, the rising significance of connectivity and safety, and online banking.

Market Dynamics

Market Driving Factors

Data Breaches and Cybersecurity Attacks and Technological Advancements

Biometric technology has demonstrated its superiority over traditional recognition techniques by keeping the data secure and encrypted because it employs human behavior patterns as a parameter. The uniqueness and permanence of the iris and fingerprint patterns serve as a technological strength. The advantages of biometric authentication and identity can be fully reaped if the provided biometric data is safe and encrypted. Organizations advise customers to update account information and change passwords in case of a data breach as a precaution. However, these safeguards are insufficient to protect biometric information. Therefore, businesses are offering multi-level biometric authentication solutions that can add another level of security in susceptible situations when data privacy and security are most significant.

The demand for personal electronics, like smartphones, laptops, and wearables, is rising quickly due to the shift in consumer mindset. The growing metropolitan regions and high purchasing power in developing and developed nations promote this. In addition, several urban areas are anticipated to experience economic growth as the middle class grows in economies like China, India, Brazil, and South Africa. With more robust user security than the traditional personal identification number (PIN) and passwords to secure sensitive data, consumer items, including tablets, smartphones, laptops, and wearables, are projected to increase in demand as the economy continues to grow. This is anticipated to lead to the usage of biometrics in consumer applications, including facial, fingerprint, and iris recognition, among others.

Another perspective element that will further drive the market is incorporating AI and data analytics in biometric authentication systems to accelerate data processing in real-time. To give real-time findings for a gait recognition system, businesses in this field employ AI and data analytics capabilities to analyze gigabytes of data per second. In places like airports and train stations, where a lot of data is collected by video cameras and processed by AI-driven engines for identification and authentication, this identification and authentication system is frequently implemented.

Market Restraining Factors

Cost of Biometric Systems

The needs of specialized applications in the government, banking, financial services & insurance, consumer devices, automotive, and several other verticals are satisfied by biometric system providers. High capital expenditure is required for the advanced biometric system's research and innovation, production, setup, maintenance, and shipping. High-performance biometric systems have large installation and maintenance expenses for their hardware and software components. Modernized raw materials and parts are needed for more advanced biometric technology, raising costs. Users are responsible for paying for delivery, installation, and routine maintenance. Thus, the demand for substantial capital restrains expanding the biometric system market. However, the faster adoption rate of these advanced technologies suggests that the cost will drop soon.

Market Opportunities

The Implementation of Digital and Contactless Identities

As consumer demand for more secure and reliable biometric solutions changes over time, research and development spending has noticed a noticeable increase. This has allowed corporations to plan for the future and profitably adjust their commercial operations. Most industry participants and experts know that physical or plastic identity credentials will eventually become obsolete and be replaced by entirely digital and contactless identities, opening up significant opportunities. According to the user's needs, the digital identities can be integrated with different BYOD devices like smartphones, tablets, or smartwatches, offering them operational flexibility. Because digital IDs eliminate plastic cards' manufacturing and logistical costs, businesses will benefit considerably from this advancement.

Regional Analysis

The region-wise segmentation of the global biometric authentication and identification market includes North America, Europe, Asia-Pacific, and Rest-of-the-World.

North America and Europe will Dominate the Regional Market

North America will command the market with the largest share while expanding at a CAGR of 16.2%. The market for biometric authentication and identification in the region is driven by aspects including financing availability, a strong economy, digitalization, and hospitable market circumstances for scientific advances. The absence of cybersecurity has cost regional businesses a lot of money, pushing for incorporating biometric authentication systems. Another major factor propelling the deployment of biometric authentication systems in North America is the growing desire for higher security standards to prevent cyberattacks. The American government and the department of defense are expected to support the integration of these technologies in the coming years, creating a favorable business environment for the biometric authentication and identification market.

Europe will expand at a CAGR of 19.3% and hold USD 5,527 million. The two more widespread applications integrated into access control or security systems in the region's border security, banking, and financial institutions, and enterprise end markets, among others, are biometric authentication and identity validation. European nations have stressed robust security systems and authentication technologies for a long time in their security standards. The Entry-Exit System (EES), for instance, was established in 2018 by the European Council for effective border control of the Schengen Area, and it has undergone continual development and updates until this point. This technology assisted in assuring several variables, including greater border automation, the fight against terrorism, improved identity fraud detection, and unapproved short-term stays of non-European Union (EU) tourists.

Segmental Analysis

The global biometric authentication and identification market is classified based on end-user, product type, deployment model, and region.

By End-User

Based on end-user, the categories include Government & Border Management Bodies, Defense Bodies, Banking & Financial Institutions, Commercial organizations, Healthcare Institutes, and Others.

The government & border management bodies section is projected to advance at a CAGR of 18.5% and hold the largest market share. In security applications, biometrics is quickly gaining ground, especially for governmental institutions. The dependability of current solutions might be significantly improved by integrating biometrics into the existing access control and verification systems. The growing number of applications for government templates and the integration of various services will drive market potential. For their mobile onboarding procedures, several governments and private financial institutions intend to use the biometric templates gathered by the government. The biometric security market is receiving an essential boost from government initiatives like e-passports, national identity programs, and other border control projects like the European Dactyloscopy (EURODAC) and the European Union Visa Information Systems (VIS).

The banking & financial institutions section will hold the second-largest market share. The primary function of banking and financial institutions is the managing of money. Banks and other financial institutions are moving quickly forward with integrating biometrics into their security measures as the numerous digital evolution trends spread throughout the main sectors of the global economy. The banking and financial industry heavily relies on biometric identification. When a customer or bank representative logs into the bank servers, their identities are verified using biometric technology.

By Function

Based on the function, the segregation includes Contact And Contactless.

The contactless section is projected to advance at a CAGR of 19.5% and hold the largest market share. Any biometric authentication method that does not call for direct user touch falls under the category of contactless biometric authentication systems. Systems for biometric identification such as facial recognition, iris, eye recognition, and audio recognition are under the contactless category. The segment's economic potential has been aided by the facial recognition system's connection with mobile devices, personal computers, and public spaces like train stations and airports.

The contact section will hold the second-largest market share. Any biometric authentication system that necessitates direct physical contact with the hardware falls within the contact section of the biometric authentication and identification industry. This category of authentication system includes technologies for recognizing fingerprints, veins in the palm, and DNA. Consumers, however, choose contactless identification methods, which limits business opportunities unless and until it is of the utmost significance.

By Product Type

Based on the product type, the categories include Face Recognition Systems, Palm Recognition Systems, Iris Recognition Systems, Signature Recognition, and Others.

The fingerprint section is projected to advance at a CAGR of 17.9% and hold the largest market share. The distinctive biometric characteristics of an individual, such as their fingerprints, are beneficial for reliably identifying people. As it is used to meet the security requirements of businesses in acquiring actionable intelligence about persons with any history of illegal actions, fingerprint authentication technology has expanded dramatically. Government organizations, healthcare providers, companies, banks, and other financial institutions have implemented this user identification technique to secure the population's total security from any coming global disaster.

The face recognition section will hold the second-largest market share. Due to its versatility in not requiring any physical touch between the device and user, facial recognition technology is a commonly accepted biometric technology in both the consumer and government sectors. The face detection solutions for access control made possible by facial recognition technology are affordable, adaptable, and dependable. This has aided the technology's commercial sector adoption and investment. The need from government organizations is a significant factor driving the market for facial recognition systems.

By Deployment Model

Based on the deployment model, the categories include On-Facility, Mobile & Tablets, Personal Computers, and Wearables.

The on-facility section is projected to advance at a CAGR of 16.7% and hold the largest market share. Government and border management bodies and corporate offices where biometric authentication systems are incorporated for check-in and check-out purposes make up most of the client base for on-facility biometric authentication systems. As more public facilities integrate biometric authentication technologies to speed up the check-in process, improve security, and lower crime rates, airports, train stations, and other public spaces can also be seen as a prospective and emerging market.

The mobile & tablets section will hold the second-largest market share. The growing popularity of personal electronics and the downsizing of biometric authentication and identification systems have made it possible to include biometric systems in smartphones and tablets. Commercial organizations and banking and financial institutions work together to a large extent to create the need for mobile and tablet deployment models in the market.

Recent Developments

• In 2022, Assa Abloy acquired Caldwell, a fenestration hardware producer for the window industry.
• In 2022, Assa Abloy acquired JOTEC Service & Vertiebsges.