Identity Verification Market Size, Share & Trends Analysis Report By Component, By Type, By Deployment Mode, By Organization Size, By Verticals, By Region, And Segment Forecasts, 2022 - 2030

Report Overview

The global identity verification market size was valued at USD 8.48 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 16.7% from 2022 to 2030. The growing frequency of identity fraud and cybercrime increased digitization initiatives, and the increasing use case of data security across verticals propels the market forward. Furthermore, measures by governments and companies focusing on digitalization and the use of emerging technologies in identity verification systems, such as AI, machine learning, and automation, would present attractive prospects for identity verification suppliers.

Increased regulations and the obligation to comply with standards across all industries, particularly in the financial sector, will likely provide numerous opportunities for market participants. Furthermore, the growing trend of BYOD and enterprise mobility are propelling the market forward.

For instance, In November 2020, LexisNexis Risk Solutions Group announced the launch of LexisNexis Fraud Intelligence, a tool that assists businesses in reducing the risk of account opening fraud.  This solution assists enterprises in minimizing new account fraud risk by combining consumer application activity and identity events to produce a comprehensive and robust score that provides a complete picture of identity proof.

During the COVID-19 epidemic, various organizations increased their identity verification measures to protect customers from fraud. Businesses are turning to digital channels and services as citizens have advanced their relationship with technology and digital gadgets. With digitalization, the possibility of cyber-attacks and security flaws increases, thus positively affecting the growth of the identity verification used to address security concerns.

The verification services like blockchain-based identity verification, adoption of Bring Your Own Devices (BYOD) in organizations, Know Your Customer (KYC) and AML (Anti-money Laundering), and identity verification in healthcare are actively responding to organizations’ increasing cyber risks and vulnerabilities. For instance, in 2021, Financial Action Task Force (FATA) expanded the scope of reporting entities and encouraged member countries to constrain virtual asset dealers, art dealers, and legal professionals to conduct anti-money laundering screening on their customers.

Moreover, the key companies in the identity verification market invest in continuous research and development processes and launch innovative products to fight cyber-attacks and security concerns. For instance, in November 2021, Experian launched Work Report, an automated verification solution that allows users to agree to share their payment details with another organization digitally. It connects to an employer's payroll information in seconds to confirm a consumer's net and gross income, job tenure, and status.

Component Insights

The solution segment led the market with a revenue share of more than 71% in 2021. The market is categorized into solutions and services based on components. Identity authentication, digital identity verification, and ID verification are the three sub-categories of the solution. The services segment will present significant growth prospects from 2022 to 2030.

Digital identity verification has become an essential component after the private and government sectors adopted more digital mediums, such as digital service access and border controls. Smart border control uses facial recognition for identity authentication and verification, electronic ID cards (eID), smart airports, and smart cities where liveness detection and video analytics are used for identity verification worldwide. For instance, in 2021, a Sandbox was established in Spain to allow biometric authentication and KYC/AML to be applied to various business areas in a secure testing environment.

Type Insights

The biometric segment dominates the market with a revenue share of more than 68.5% in 2021. Biometric identification verification is the most common type of identification verification, and it establishes a person's legitimacy based on one or more biological traits. Fingerprints, retina and iris patterns, and other biometric verification procedures are commonly used. Biometric solutions use lock-and-capture mechanisms to verify individuals and assist in providing access to a limited set of services.

Traditional non-biometric solutions are less secure and acquire traction than biometric alternatives. Due to the increasing intrinsic demand from consumers for compliance management, seamless onboarding, and fraud prevention, the biometric solutions industry is growing at a significant rate. Non-biometrics solutions are primarily used to detect fraudulent ID, business process automation, remote customer onboarding, and KYC/AML compliance. 

After integrating AI and ML technologies into identity verification solutions, organizations can stay proactive and make very effective remediation and detection in response to invasive and suspicious activities and unauthorized access requests on an enterprise network. For instance, in august 2020, GBG partnered with Contemi Solutions to fully automate Anti-money Laundering (AML) and Know Your Client (KYC) processes for financial services institutions and Contemi clients. This alliance provides a paperless onboarding experience through a single API without sacrificing security.

Deployment Insights

The on-premises segment led the market with a revenue share of 59.5% in 2021. An on-premises service enables the enterprise to authenticate its client base and store its information on its servers. No third party has access to the client data after a one-time installation, so a second vendor or service provider is not needed. Companies can ensure a secure customer onboarding procedure with the help of this service, keeping the acquired data safe from criminal activity.

Cloud-based identity verification solutions are suitable for enterprises with limited security budgets. Small businesses can identify vulnerabilities and minimize threat landscapes at a lower cost with a cloud-based implementation, increasing customer service. Cloud-based identity verification solutions assist enterprises in managing their costs and improving their business efficiency.

Organization Size Insights

The large enterprises segment led the market with a revenue share of 65.4% in 202. Due to increasing fraudulent activity, money laundering, processing of high-risk transactions, identity theft, cost-cutting on manual processes, and compliance with various legislation, large corporations have chosen identity verification systems. Many organizations are turning to identity verification services to improve the consistency of their security tools and platforms.

The small & medium enterprises segment is anticipated to grow with the highest CAGR from 2022 to 2030. Identity verification software provides SMEs with a hassle-free, simple, low-cost, intuitive, and secure solution to suit their growing needs. Because of limited resources, the scarcity of IT personnel, and budget constraints, SMEs focus on implementing identity verification software to save resources, time, money, and assets.

Verticals Insights

The BFSI segment dominates the market, with a revenue share of 28.5% in 2021. The increased digitization of banking procedures, such as digital onboarding and digital payments, aimed at improving the client experience simultaneously increases the need for identity verification worldwide. The market is divided into BFSI, Government & Defense, Healthcare & Life Sciences, Retail & eCommerce, Energy & Utilities, IT & ITeS, and Others, based on the end-user.

Banks increasingly depend on identification technology to safeguard the confidentiality and security of personal data they have collected about customers, workers, and partners. Identity management technologies are essential in the financial services industry because they allow for the construction of secure and efficient mechanisms for access control and identity verification. The retail and e-commerce segment is expected to grow at the fastest compound annual growth rate (CAGR) of 23.2% from 2022 to 2030, due to aspects such as the necessity to minimize cyber threats and the adoption of a risk-based fraud defense approach.

Regional Insights

North America dominated the market with a revenue share of more than 39.6% in 2021. It is an advanced technological region with many early adopters and key market players. The demand for identity verification is expected to be driven by the development of government initiatives like smart cities, smart infrastructure, and digital identity-based driver's licenses. The increasing integration of various technologies, such as blockchain AI and ML, for securing digital identities.

Asia Pacific is predicted to contribute to the fastest-growing region with the most significant CAGR during the forecast period because it has become technologically prepared by adopting new technologies. The growth is driven by factors such as government initiatives to combat identity-related fraud and reinforcing eKYC to verify identities. Asia-Pacific is among the fastest-growing regions in GDP, resulting in business expansion and new startup formation. It increased the need for strong identity verification ways of preventing data breaches by creating a need for rapid, safe, and paperless digital transactions across these growing corporations.

Key Companies & Market Share Insights

The market is characterized by intense competition with the presence of a few major global players holding a significant market share. Key players emphasize new product developments and alliances as options for higher profitability through improved client interactions. For instance, In December 2020, Trulioo partnered with Credit Sesame, an online banking services company; This collaboration entitled Credit Sesame to advance privacy for its clients through Trulioo’s GlobalGateway biometric identification platform. Some prominent players in the global identity verification market include:

• Acuant, Inc.

• Equifax, Inc.

• Experian Plc

• GB Group PLC

• IDEMIA

• Intellicheck Inc.

• Mitek Systems, Inc.

• Nuance Communications Inc.

• Thales Group S.A.

• TransUnion LLC.

Identity Verification Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global identity verification market report based on type, component, deployment, organization size, vertical, and region:

• Type Outlook (Revenue, USD Million, 2017 - 2030)

  • Biometrics

  • Non-biometrics

• Component Outlook (Revenue, USD Million, 2017 - 2030)

  • Solution

  • Service

• Deployment Outlook (Revenue, USD Million, 2017 - 2030)

  • On-premises

  • Cloud

• Organization size Outlook (Revenue, USD Million, 2017 - 2030)

  • SMEs

  • Large Enterprises

• Vertical Outlook (Revenue, USD Million, 2017 - 2030)

  • BFSI

  • Government and Defense

  • Healthcare & Life Sciences

  • Retail and eCommerce

  • IT & IteS

  • Energy and Utilities

  • Others (Education, Travel, and Gaming)

• Regional Outlook (Revenue, USD Million, 2017 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • U.K.

    • Germany

    • France

  • Asia Pacific

    • China

    • Japan

    • India

  • South America

    • Brazil

  • Middle East & Africa