Market Overview
The global identity verification market size was valued at USD 8.43 billion in 2021 and is predicted to reach USD 32.94 billion by 2030, increasing at a CAGR of 16.35% from 2022 to 2030. Factors such as increasing internet penetration, increase in identity thefts and digital literacy significantly drives the identity verification market demand by 2030.
Businesses of all types make use of various identity verification solutions and services to determine whether or not the information provided by users or customers is linked to the identity of a genuine person. A high level of assurance is provided by the identity verification solution, which verifies detailed client attributes such as personal credentials, nationality, immigration status, identification document verification, and employment and business registration.
Identity verification is a comprehensive solution that ensures a secure customer enrolment process, reduces the risk of identity fraud, and provides a real-time, seamless onboarding experience. The requirement of identity verification processes is present in the vast majority of processes and procedures, regardless of whether they take place online or offline.
Verification of identity is a requirement that must be met wherever it is necessary to have one's identity verified, such as at border controls or to access digital services. The expansion of the identity verification market is expected to be driven by the increasing frequency of data breaches and frauds related to individuals' identities.
Market Dynamics
Global Identity Verification Market Drivers
Increasing Internet Penetration and Digital Literacy
In the future years, the demand for new trends in the market for virtual identity verification is likely to develop as a result of the growing trend of smart services that various company organizations are providing for their clients. The rising number of online procedures, such as financial transactions and activities related to online onboarding, has boosted the demand for business identity verification in worldwide markets. This increase in demand for online services has resulted in the formation and expansion of third-party identity verification businesses in many regions of the world. These businesses are able to verify the identities of customers using a variety of internet platforms. People in all countries are becoming more literate in digital technology on a daily basis, which enables them to utilize a variety of different kinds of online services. The expansion of the market for online identity verification is being driven in part by the increasing number of people in developing countries who use the internet to purchase a variety of online services.
Identity Verification Market Fueled by An Increase in Identity Thefts
In order to carry out their day-to-day operations and commercial procedures, companies are growing increasingly dependent on digital data and computer networks. Personal and financial data are being exchanged and stored in ever-increasing quantities over the internet. In addition to traditional bank account theft, cyber thieves are increasingly using stolen credentials to open fraudulent mobile phone accounts, internet payment accounts, and online merchant accounts.
Hacking was the most common manner of a data breach in 2019, according to the ITRC, with 577 incidents exposing 15.3 million records. As criminals get more adept, identity theft is becoming more widespread. Cyber fraudsters are increasingly focusing on financial accounts, such as loyalty and reward programs and retirement accounts, which have led to an increase in account fraud losses. As a result of the increasing frequency of identity thefts and data breaches, the identity verification market is expected to develop.
Global Identity Verification Market Restraints
Vendors' Differing Prices for Identity Verification Services and Products
An identity verification system or service's cost is determined by elements such as the price per verification, languages and data storage as well as technical support. The majority of organizations charge per verification, per month, and per year, with a restricted number of ID verification checks included. Flexible prices per verification may also be available from some vendors for annual packages. There is a problem with ID verification suppliers charging various prices for their services. As an illustration, the ID verification pricing at iDenfy starts at USD 1.18 per verification, whereas the price per customer verification at Shufti Pro commences at USD 1. Customers are unsure of which solution or service to choose because of this price discrepancy. According to the primary, clients are struggling with the pricing discrepancy between ID verification solution providers.
Global Identity Verification Market Opportunites
With An Increase in Technological Innovation, New Possibilities Are Emerging
Demand for identity verification services on digital platforms has increased as biometric recording equipment and devices have improved. There are more Identity verification solutions sold than services because the process of virtual Identity verification is so dynamic and involves so many different user interfaces and record-keeping systems.
E-Governance is a new concept that is being implemented by both industrialized and developing countries. Throughout the last decade, the number of government agencies using remote ID verification for things like social security cards and driver's licenses to provide various public services has multiplied. In the years to come, these services are predicted to offer a wide range of opportunities for market merchants.
Regional Analysis
The global identity verification market is segmented by geography into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
In 2021, North America held a dominant position in the market with a revenue share that was greater than 41 percent. It is a technologically advanced region that also contains a large number of early adopters and significant market players. It is anticipated that the expansion of government projects such as smart cities, smart infrastructure, and digital identification-based driver's licenses will fuel demand for identity verification services. Integration of an expanding number of different technologies, such as blockchain, artificial intelligence, and machine learning, with the purpose of safeguarding digital identities.
Because of the region's increased technological preparedness as a result of its adoption of new technologies, it is anticipated that Asia Pacific will be a major contributor to the fastest-growing region with the highest significant CAGR during the duration of the prediction. The expansion is being propelled by a number of causes, including government attempts to combat identity-related fraud and the strengthening of e-KYC to authenticate identities. The Asia-Pacific region is one of the regions with the highest GDP growth rates, which has led to the establishment of new businesses and the development of existing ones. Because of this, there is a growing demand across these expanding businesses for digital transactions that are quick, secure, and paperless. This has resulted in an increase in the importance of robust identity verification methods for preventing data breaches.
Segmental Analysis
The global identity verification market share is divided into different segments according to the Component, Type, Deployment Mode, Organization Size, Verticals, and Region.
By Component, the global market is segmented into solutions and services. In 2021, the solution segment accounted for more than 70% of the market's revenue. Components are used to divide the market into solutions and services. The three sub-categories of the solution are identity authentication, digital identity verification, and ID verification. During the period of time between 2022 and 2030, the services industry is expected to see tremendous expansion.
After the adoption of more digital mediums by the business and public sectors, such as digital service access and border controls, digital identity verification has become a vital component. E-IDs, smart airports, liveness detection, and video analytics are utilized for identity verification in smart cities around the world, where facial recognition is employed for identification and verification.
By Type, the global market is segmented into Biometrics and Non-biometrics. In 2021, biometrics accounted for more than 70% of the market's revenue. It is the most prevalent method of identification verification, and it is based on one or more biological features to confirm the person's authenticity. Biometric verification methods such as fingerprints, retina and iris patterns, and others are frequently employed. Lock-and-capture techniques are used by biometric solutions to verify individuals and assist in providing limited access to services.
Using non-biometric solutions is less secure and has less traction than using biometric solutions. The biometric solutions market is expanding rapidly as a result of rising customer demand for services such as compliance management, easy onboarding, and fraud protection. When it comes to fraud detection, business process automation, remote customer onboarding and KYC/AML compliance are the primary uses of non-biometrics solutions.
By Deployment Mode, the global market is segmented into On-premises and Cloud. In 2021, the on-premises category had a revenue share of 62%. With an in-house option, businesses may verify their customers and keep their data on their own servers. After a single installation, no one else has access to the client's data, so a second vendor or service provider is not required. Using this service, businesses can ensure a safe onboarding process for new customers while also safeguarding the data they collect.
Businesses on a tight security budget can benefit from cloud-based identity verification systems. With a cloud-based solution, small organizations can uncover vulnerabilities and reduce threat landscapes at a cheaper cost, boosting customer service. For businesses, the use of cloud-based identity verification technologies can save expenses and boost productivity.
By Organization Size, the global market t is segmented into SMEs and Large Enterprises. With a revenue share of 68% in 2021, the big enterprise segment dominated the market. Large organizations have turned to identity verification systems because of the rise in fraud, money laundering, high-risk transactions, identity theft, cost-cutting on manual operations, and compliance with numerous laws. Identity verification services are being used by a growing number of companies to ensure that their security tools and platforms are consistent.
From 2022 through 2030, the fastest-growing sector is expected to be small and medium-sized businesses (SMEs). Small and medium-sized businesses (SMEs) now have an easy, low-cost, user-friendly, intuitive, and secure identity verification solution at their disposal. There are very few IT resources available, thus small and medium-sized businesses (SMEs) rely on identity verification software to save time, money, and resources.
By Verticals, the global market is segmented into BFSI, Government and Defence, Healthcare & Life Sciences, Retail and E-Commerce, IT & ITES, Energy and Utilities, and Others (Education, Travel, and Gaming). In 2021, the BFSI category accounted for 32 percent of the market's revenue. An increase in the use of digital onboarding and payments to improve the customer experience simultaneously raises the requirement for identity verification around the world. Market segmentation is based on the kind of end-user (BFSI, Government & Defence, Healthcare & Life Sciences, Retail & eCommerce), as well as other factors (IT & ITES).
For the protection of their customers', employees', and partners' personal information, banks are increasingly turning to identification technology. It is crucial for the financial services industry to employ identity management systems because they enable secure and efficient mechanisms for access control and identity verification. CAGR for retail and e-commerce will be 26 percent from 2022 to 2030, due to factors including the need to reduce cyber threats and adopt a risk-based fraud defense approach.
Top Key Players
Equifax, Inc.
Thales Group S.A.
Experian Plc
Acuant, Inc.
Mitek Systems, Inc.
TransUnion LLC.
GB Group PLC
IDEMIA
Intellicheck Inc.
Nuance Communications Inc.
Others
