Global Statistics Representing Identity Verification Software Market Scenario
Identity verification refers to a process that validates traits to verify that the data presented to a business or entity pertains to a real person. It allows a person with digital credentials to gain access to online accounts, activities, and services. When an individual claims his/her own identity with the concerned party for the first time, the identity of the person is verified to ensure its authenticity. This process is known as account onboarding.
Globally, the identity verification software market was valued at USD 5.31 in 2019 and is expected to reach USD 14.34 billion by 2027, with a CAGR 15.7% during the forecast period, 2020–2025.
The ubiquity of smartphones, coupled with widespread internet accessibility, has led to tremendous growth across industry verticals. The development of cloud infrastructure has digitalized businesses, not only increasing the profitability of services but also enhancing customer experience. As per GSMA, globally, smartphone adoption is expected to reach 2.9 billion by 2020.
The adoption of smartphones, coupled with affordable online and internet services, is expected to have a significant impact on financial services. P2P payments, check cashing services, international transfers, and loan origination, among others, have become seamless, which is expected to positively influence the identity verification software market during the forecast period.
On the flip side, the lack of security solutions and rising incidents of suspicious activities through the online channel have increased security concerns in the vertical. The below tables list data breach cases through the online channel as per the 2019 Data Breach Investigation Report published by Verizon.
The above tables depict that data breaches mostly compromised personal credentials through online channels; thus, in order to prevent such data breaching cases, the demand for verification solutions has been increasing.
Growth Prospects in Emerging Economies
According to McKinsey Global Report, economies such as the U.S., the U.K., and China have significant ID coverage. However, emerging economies such as India, Brazil, Nigeria, and Ethiopia lack coverage to a significant share of the population. Additionally, a major share of these populations lacks access to digital ID, which eventually drives the identity verification market.
The report also suggests that digital ID is expected to add multi-billion economic value to economies. The following figure indicates the potential growth of Digital ID by 2030.
In light of these factors, the market is expected to gain significant traction in the emerging economies of the world. As per our analysis, geographically, North America dominates the identity verification software market at present, and the region is expected to remain the key value shareholder throughout the forecast period. The U.S. accounts for the largest market share in North America, which can be attributed to the country’s cloud infrastructure and the presence of noteworthy solution and service providers such as Oracle Corporation, IBM Corporation, and Microsoft Corporation.
Asia-Pacific is the fastest-growing region in the global identity verification software market. Countries in the region lack digital ID accessibility and advancement in fintech solutions will pave the way for the timely digital verification process, notably in BFSI sectors.
Government initiatives for national ID cards in Asia, notably India, Malaysia, Pakistan, and Indonesia, are also expected to drive the identity verification software market during the forecast period.
Identity Verification Software Market: Segmentation Insights
The identity verification software market has been segmented on the basis of component, deployment mode, organization size, and industry vertical for the purpose of study and estimation.
By component, the market has been differentiated into solutions and services.
- The solution segment accounted for the larger market share in 2019 and is expected to register significant growth during the forecast period.
- The services segment is expected to register a higher CAGR during the forecast period.
By solution, the market has been segmented into ID verification, ID authentication, and digital identity verification.
- The digital identity verification segment accounted for the largest market share in 2018 and is expected to witness significant growth during the forecast period.
- The ID verification segment is projected to exhibit the highest CAGR during the forecast period, with the increasing number of digital frauds driving the adoption of the solution, notably in the BFSI sector.
By services, the market has been segmented into professional services and managed services.
- The managed services segment is projected to exhibit the highest CAGR during the forecast period, which can be attributed to enterprises’ inclination toward the adoption of cost-efficient solutions offered by third-party service providers.
- The professional services segment has been further sub-segmented into consulting services, training and implementation services, and other support services.
- The consulting sub-segment accounted for the highest market share in 2018.
- The training and implementation services segment is projected to register the highest CAGR during the forecast period.
By deployment mode, the market has been segmented into cloud and on-premise
- The cloud segment accounted for the larger market size in 2019 and is anticipated to record the higher CAGR during the forecast period.
- The on-premise segment is expected to witness higher growth in the government and BFSI sectors during the forecast period.
Based on organization size, the market has been segmented into large enterprises and small and medium enterprises (SMEs).
- The large enterprise's segment accounted for the larger market share in 2019, owing to the availability of high financial budgets to maintain ID verification systems.
- The SME segment is expected to witness a higher CAGR during the forecast period due to the increase in data breaching cases, particularly in the BFSI, governments, and defense sectors.
Based on industry vertical, the identity verification software market has been categorized into BFSI, government and public sector, military and defense, retail and e-commerce, healthcare, energy and utility, high-tech, IT and telecom, media and entertainment, and others.
- The BFSI segment accounted for the larger market share in 2019 and is expected to dominate the market on account of the increasing number of banking frauds and money laundering cases that result in high debt and non-performing assets.
- The military and defense sector is expected to witness the highest CAGR during the forecast period.
Collaborative Efforts by Vendors in the Global Identity Verification Market
- On February 2, 2020, Jumio, one of the leading providers of AI-powered identity verification solutions, partnered with CIMB Bank Philippines’ all-digital bank to offer a seamless digital onboarding solution to citizens of the Philippines. Jumio entered the partnership with an aim to increase its market profitability from the BFSI sector.
- In January 2020, Acuant, an identity verification solutions provider, partnered with Nikia Dx to enhance the latter’s security and compliance offerings. The partnership allows the latter to access the former’s Trusted Identity platform, which is backed by artificial intelligence. Additionally, it will help the latter’s customers with secure digital transactions. The partnership will help Acuant expand its customer base, eventually strengthening its foothold in the identity verification software market.
- In December 2019, Trulioo, a Canada-based Identity verification solution provider, extended its geographical coverage by partnering with two Western African states, namely Ghana and Nigeria. The company offered its GlobalGateway verification platform, which helped the two nations capture data from various sources.
- In February 2019, Mitek, a leading provider of mobile capture and digital identity verification solutions, partnered with BioMetric Signature ID, gesture-based biometrics for ID verification and access management solution provider, to provide digital identity proofing for instant and seamless gesture biometric registration process. The partnership allowed both the companies to strengthen their product portfolios, thereby helping their expand their customer base and strengthen their presence in the identity verification software market.
Identity Verification Software Market: Key Players
- Trulioo (Canada)
- Acuant (The U.S.)
- Jumio (The U.S.)
- IDMERIT (The U.S.)
- Equifax (The U.S.)
- Experian (Ireland)
- Gemalto (The Netherlands)
- IDEMIA (France)
- Authenteq (Iceland)
- LexisNexis (The U.S.)
- Shufti Pro (The U.K.)
- Onfido (England)
- TransUnion (The U.S.)
- Mitek Systems (The U.S.)
- iDenfy (Lithuania)
Some of the other companies that hold significant value shares in the identity verification software market include Evident, EveryoneAPI, OneSpan, Oaro Identity, Melissa Digital Identity Verification, Mati, IDVision, IDresponse, IDology, Inc., and IdentityMind's 2.0 platform, among others.
Frequently Asked Questions (FAQs)
Rising Adoption of smartphones, coupled with affordable online and internet services are the key factors expected to drive Identity Verification Software Market during the forecast period.
Globally, the identity verification software market was valued at USD 5.31 in 2019 and is expected to reach USD 14.34 billion by 2027, with a CAGR 15.7%.
North America is expected to hold the highest market share in Identity Verification Software Market.
Trulioo, Acuant, Jumio, IDMERIT, Equifax, Experian, Gemalto, IDEMIA, Authenteq, LexisNexis, Shufti Pro are the top players in Identity Verification Software Market.
In 2019 Global Identity Verification Software Market was valued at USD 5.31 in 2019.
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