Palm Vein Biometrics Market

Market Overview

The palm vein biometrics market size was valued at USD 0.8 billion in 2022. It is expected to reach USD 6.03 billion by 2031, growing at a CAGR of 22.4% during the forecast period (2023–2031).

A biometric and contactless authentication method known as palm vein biometrics compares the palm vein scan image of the individual captured at that precise moment to the image of the palm vein scan stored in the database. Vascular patterns are primarily used as personal identification information. As the data is retrieved from the body, it is a very secure technology that is challenging to copy. As a result, it has numerous uses in business security, gaming, banking and finance, consumer electronics, healthcare, and other fields. The palm vein biometrics market is expanding thanks to scanning and biometrics technology advances.

Market Dynamics

Global Palm Vein Biometrics Market Drivers:

Growing Concerns about the Protection of Data

The proliferation of connected solutions, mobile and online transactions, and smartphones has increased consumer concern over data protection. According to a study by Fico, two out of every five Malaysians expect to enroll in biometrics when they open bank accounts. More people in the country are more comfortable opening smartphone accounts than in the United States or Canada. This is where the demand for biometrics rises as consumers' identities are secure. The study also discovered a rise in confidence in using biometrics for online financial data security. Three out of five Americans and 43% of Canadians would use a biometric scan, such as a fingerprint, to open an account. An increase in e-commerce-related fraud and losses is driving the demand.

Rising Need for Secure Financial Transactions

Over the forecast period, the market for payment security is anticipated to grow due to the rising use of digital payment methods like credit/debit cards, mobile wallets, and online transactions. One of the main drivers of the expansion of the payment security market is the rise in data breaches. The State of Mobile Payments 2019 Report from the Electronic Transaction Association estimated that 55 million Americans used their smartphones to pay at physical points of sale in 2018—either by charging a credit/debit card or adding money to a closed-loop mobile app like the Starbucks app. Moreover, 2.1 billion consumers worldwide are anticipated to use an e-wallet to make a payment or send money, according to the Payment Methods Report 2019 by the European Payment Council. Global mobile payment growth is further accelerated by the rapidly expanding loyalty programs in the mobile wallet space.

Global Palm Vein Biometrics Market Restraints:

Limitations in Technical Aspects of Palm Vein Biometrics

The technology has several drawbacks, even though it is impossible to forge a person's palm vein pattern. For example, palm vein biometrics are not hygienic because they require direct physical contact with a biometric device; this is especially true if used in a healthcare setting. However, technological advancements are assisting in developing contactless palm vein biometrics. Another essential drawback is that palm vein technology can only be implemented in small database environments because it can only be used for 1:1 search. Additionally, the widespread adoption of Iris and facial recognition technology restricts the development of new technologies.
In contrast to the iris or retina, a person's vein pattern structure could change throughout their lifetime, necessitating a new enrollment process. Frequent enrollment is anticipated to annoy customers and raise expenses for the businesses running the system. Ambient light from the surrounding environment can have a negative impact on vein pattern recognition.

Global Palm Vein Biometrics Market Opportunities:

Growing Need for Touchless Biometric Systems

People's attitudes toward interacting with touch-based solutions are changing due to the global health crisis, so businesses must prioritize user safety during enrollment and authentication by implementing cutting-edge biometric technologies. The veins that are hidden beneath the surface of a user's palm are imaged using palm vein authentication technology, which uses near-infrared light. Users can avoid direct physical contact with the palm vein scanning device's sensor thanks to near-infrared light, extending both the sensor's lifespan and the lifespan of the entire machine. Some scanning devices can handle finger vein authentications, fingerprint authentications, palm vein authentications, and iris authentications from within a single scanning unit, thanks to the most recent advancements in palm vein authentication technology.

Regional Analysis

Asia-Pacific Dominates the Global Market

The global palm vein biometrics market is segmented by region: North America, Europe, Asia-Pacific, and the Rest of the World.

Asia-Pacific is the most significant revenue contributor and is expected to grow at a CAGR of 23.25% during the forecast period. The use of multiple biometrics technology in the region is anticipated to be primarily driven by rising mobile transactions in nations like China and India and government initiatives. Accurate contactless technology is palm vein biometrics, which uses vascular patterns for identity verification. Fujitsu's palm vein biometric system is used by the Bank of Tokyo-Mitsubishi, one of the top banks in Japan, to offer a secure and affordable solution for identity authentication and money transfers. The market is being driven by Japanese banks, who are impressed by the palm vein technology's security-enhancing capabilities. Biometric-authorized payments are increasingly disrupting the retail sector in the region.

Additionally, Korea uses biometric authentication to speed up and simplify shopping. Recently, a convenience store permitted hand scanning for payment. Companies are likely to incorporate biometric features due to the increasing use of mobile devices and the rising acceptance of mobile payments, which will increase demand for the market.

Europe is expected to grow at a CAGR of 22.01% during the forecast period. People and organizations have been searching more and more for much more trustworthy forms of personal identification as a result of the rise in criminal activity over the past few years, including terrorist attacks in cyberspace, information leaks as a result of insider actions, fraudulent funds transfers via Internet banking, and information leaks due to insider actions. The growing emphasis on biometrics by the region's financial institutions and government initiatives for identification and security is anticipated to drive the European biometrics market. Furthermore, the EU's updated Payment Services Directive (PSD2) has created a new era of open banking. As a result, it is anticipated to significantly impact banking innovation, security measures, and business models. PSD2 demands that businesses offer their clients reliable two-factor authentication and transaction signature techniques. This will accelerate the use of biometrics in the local payment ecosystem. Although other biometrics, like facial, iris, and palm vein pattern recognition, are anticipated to gain popularity in the region over the forecast period, fingerprint recognition is one of the dominant modalities in the region's payment sector.

The North American region is anticipated to hold a sizable market share due to the widespread adoption of cutting-edge technologies. The region's end-user industries have an increasing need for advanced security systems, helping the market grow favorably. Additionally, the area has many established vendors, which allows the market to expand. Imprivata, Inc., IdentyTech Solutions America Inc., and M2SYS Technology - Kernello Inc. Palm vein biometrics are being adopted by numerous BFSI companies, accelerating the market's expansion in the area.

Latin America, the Middle East and Africa make up most of the rest of the world. The growth of e-commerce in Latin America is expected to be a significant market driver. When it comes to utilizing the conveniences of the internet, the financial sector was one of the pioneers in Brazil. Demand for biometric authentication tools is expected to rise in the region because of increasing identity theft and online fraud incidents. Brazil and other nations in the region, in addition to Japan, have implemented palm vein authentication to identify users during ATM banking transactions. 

Furthermore, the biggest private bank in the area, Banco Bradesco, has tested palm vein authentication technology alongside other biometric technologies. The high level of verification accuracy and the non-invasive and hygienic nature of palm vein authentication were significant factors in the bank's decision to implement it. Government-sponsored biometric identification programs and the growing use of biometrics in the BFSI industry are anticipated to be substantial market growth drivers in the Middle East and Africa.

Segmental Analysis

The global palm vein biometrics market is segmented by type and application.

Based on type, the global palm vein biometrics market is bifurcated into hardware, software and solution.
The software and solution segment is the highest contributor to the market and is expected to grow at a CAGR of 21.56% during the forecast period. Palm vein biometric software enables interoperability and functionality between biometric devices, computers, and networks to which they are connected. It also allows effective connection and makes it possible for various application software on different operating systems to be compatible. The software that palms vein biometric systems use is crucial. To detect fraud, software in palm vein biometrics is further integrated with cutting-edge technologies.

Additionally, because the palm vein biometric solution is so scalable, businesses are embracing it. Depending on the size, different businesses have different enrollment rates. Companies can subscribe to services to their needs, thanks to biometric solutions. By altering the subscription plan, scaling up or down the facilities is very simple.
Scanner, camera, signature capture pads, sensor, and microphone are examples of the hardware used in palm vein biometrics. A biometric sensor converts an individual's biometric data into an electrical signal. The sensor measures a variety of energies, including light, temperature, electrical capacity, and others. The two types of these sensors are physiological biometrics and behavioral biometrics. Face recognition, hand geometry, fingerprint, iris recognition, and DNA are examples of physiological biometrics. Keystroke, voice, and signature recognition are all included in behavioral biometrics. For use in various biometric types, multiple sensors are adopted. For instance, capacitive sensors are frequently used in palm vein biometrics because they provide better security and are challenging to spoof.

Based on the application, the global palm vein biometrics market is bifurcated into healthcare and BFSI.
The BFSI segment owns the highest market and is expected to grow at a CAGR of 21.79% during the forecast period. Strict measures are being implemented to protect sensitive customer data as banking fraud cases emerge. Utilizing analyses of people's biological characteristics, biometric authentication technology automatically recognizes, verifies, and grants users access to the system. In the banking industry, this is picking up steam. To give customers secure access to online accounts, several central banks and financial institutions have integrated biometrics technologies, such as palm vein recognition technology, with access control systems in mobile applications that are used on mobile devices, such as smartphones. 

Palm vein biometrics are being adopted by many BFSI companies, accelerating market expansion. For instance, in collaboration with the financial technology company Fiserv, Gesa Credit Union, a financial services institution, uses palm recognition technology. Fiserv is a provider of financial services technology solutions. It offers integrated services, such as Verifast: Palm Authentication for biometric authentication and a DNA account processing platform.
The healthcare industry is also adopting biometric technologies like palm vein biometrics. Such devices are advantageous from a hygienic standpoint because the development of this authentication technology does not require any physical contact from users with the scanning device. As a result, organizations in the area, like Fujitsu, are providing contactless palm vein authentication devices to meet the demand for authentication security. The confidentiality of sensitive information relating to a specific patient and information about how the concerned person handled and used the appropriate equipment must be maintained by healthcare organizations. Any flaw in the way a patient is treated throughout the entire process has the potential to result in fatalities. Since identity theft has become one of the most common criminal activities in developed countries, medical information about a patient or any other organization stakeholder may be compromised and used to steal someone’s identity further. Such elements are anticipated to encourage the use of sophisticated authentication techniques in this industry, like palm vein biometrics.

Recent Developments

• January 2023- Ingenico and Fujitsu Frontech unveiled a biometric payment solution based on palm vein identification.
• November 2022- Startup Keyo’s palm vein biometrics ready for complete ID management applications.