Optical Character Recognition Market Size, Share & Trends Report

Optical Character Recognition Market Size, Share & Trends Analysis Report By Type (Software, Services), By Vertical, By End Use (B2B, B2C), By Region, And Segment Forecasts, 2021 - 2028

  • Published Date: Feb, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-3-68038-210-5
  • Format: Electronic (PDF)
  • Historical Data: 2017 - 2019
  • Number of Pages: 150

Report Overview

The global optical character recognition market size was valued at USD 7.46 billion in 2020. It is expected to expand at a compound annual growth rate (CAGR) of 16.7% from 2021 to 2028. The optical character recognition technology is used to convert content on physical documents into digital form. It helps users to convert different types of images and documents into an editable format. Furthermore, it is used in various industries, such as the logistics and transportation industry, BFSI, and others. Government, banking, retail, healthcare, manufacturing, and other sectors also have wide adoption for OCR technology. With the rising age of digitalization, enterprises invest a lot of money in technologies to increase work efficiency and productivity. For instance, in August 2020, Infosys Limited, an Indian multinational corporation, launched an AI-driven solution to automate helpdesk operations in collaboration with Blue Prism Limited, a U.K.-based multinational software corporation. This solution combines the AI and NLP (Natural Language Processing) with automation platform and OCR capabilities.

Asia Pacific optical character recognition market size, by type, 2017 - 2028 (USD Million)

Digitalization in business organizations has made all the processes faster and more accessible. As companies are witnessing technological advancements, data is becoming a critical element for growth. When data is converted to digital form, it can be processed by computers and a variety of devices with computing capacity. This data is easy to share, access, and store. Companies established before digitalization became a norm in the enterprise sector have also started using tools, such as OCR to convert their physical data into digital form. The technology also finds increasing application in BFSI and the healthcare sectors for creating digital copies of checks, invoices, and other documents. For instance, in May 2019, Standard Chartered Bank launched an augmented intelligence document processing solution, called Trade AI Engine, developed in collaboration with IBM. This solution is developed to tackle the time-consuming process of unstructured traditional documentary review.

The OCR technology is also being widely used for converting information available in text form into speech with the help of text-to-speech technologies, thus making it accessible to blind and visually impaired individuals. Other applications of the technology include sorting out letters at post offices and documents in law firms and courts along with preserving historical and cultural texts, personal identification, and processing invoices, orders, and other documents. For instance, in July 2020, Jobvite, Inc., an end-to-end talent acquisition suite, acquired the data science and AI team at Predictive Partner. This acquisition is anticipated to leverage AI through natural language processing, machine learning, predictive analytics, and optical character recognition.

Numerous benefits of optical character recognition technology have helped companies save time spent on entering data manually in a computer, enhancing work management, reducing the cost of converting documents into digital form, and reducing manual errors, among others. It also offers other benefits such as improved customer service and increased security of documents, significantly propelling demand across industries, including BFSI and retail. Increased focus of cognitive solution developers on integrating advanced technologies to improve accuracy is also expected to significantly drive the market growth in the near future. For instance, in May 2020, THIRDEYE, an AR/ VR enterprise solutions provider, partnered with NuEyes, a vision impairment solutions provider. Under this partnership, NuEyes will introduce smart glasses to assist people with vision loss. These smart glasses will use ThirdEye’s lightweight X2 MR Glasses that have optical character recognition capability.

Type Insights

The software segment led the market in 2020, accounting for over 80% share of the global revenue. The high share can be attributed to the increasing requirement in data-driven organizations for converting physical documents into digital form. The software segment is further divided into mobile-based OCR, desktop-based OCR, cloud-based OCR, and others. Most optical character recognition software is available in open source, so organizations can quickly deploy it within their workflow. Integration of advanced technologies to increase the accuracy of scanned data has further propelled the software segment's growth. Several companies continue to offer OCR software with the latest technologies and features, which propels the availability of software for buyers. For instance, in June 2020, iText Group nv (HQ Belgium), Inc., a global PDF libraries and solutions provider, launched the iText pdfOCR as a part of the iText 7 PDF SDK. This newly launched software offers OCR functionality to convert images into a fully searchable PDF compliant format, and printed text in scanned documents.

The service segment accounted for a market share of 17.6% in 2020 and is expected to expand at a CAGR of 18.2% over the forecast period. Outsourcing services dominated the service segment in 2020 and accounted for a market share of 44.2%. Business owners outsource their data extraction services to get synthesized information and utilize it for better decision-making. There are numerous companies offering outsourcing services for optical character recognition operations. For instance, Flatworld Solutions Pvt. Ltd. offers OCR clean-up services, document digitizing services, document scanning services, and conversion services. Furthermore, in May 2019, Amazon Web Services, Inc. announced the general availability of Amazon Textract. Amazon Textract is a fully managed service that utilizes machine learning to extract texts and data.

Vertical Insights

The BFSI segment led the optical character recognition market in 2020, accounting for over 19% share of the global revenue. The high share can be attributed to the penetration of OCR technology in the banking industry to scan different types of documents, receipts, and checks and to convert all the information into a form recognized or understood by a computer. For instance, ABBYY, a digital intelligence company, provides digital banking solutions for banks and financial institutions. For instance, DBS Bank, a Singapore-based banking and financial services corporation, has employed ABBYY Mobile OCR Engine to extract and fill in the relevant information in its on-the-go loan application. It enhances and simplifies the customer experience with loans. In March 2020, Sony Bank Inc., a Japanese commercial bank, launched a new English-language online banking service for non-Japanese residents. This app uses OCR technology to make the account opening process easier and quicker.  

Character recognition is anticipated to continue finding applications across various industries in near future. For instance, in the transport and logistics industry, OCR can help in scanning the tracking numbers of parcels and postal codes of delivery locations rather than necessitating that they are noted down physically, thereby speeding up the overall processing, tracking, and shipping of packages, and the subsequently reducing costs. For instance, The MARINE DIGITAL SYSTEM SIA offers a solution called DIGIdock, for recognizing scanned photos and copies of documents, and downloading data to an electronic archive of documents accounting system. It contains universal functionality for small and medium-sized companies in the transport & logistics and warehouses industry.

End-use Insights

The B2B segment led the market in 2020, accounting for over 75% share of the global revenue. The high share can be attributed to the fact that several businesses use software solutions to combine character recognition technology with intelligent features, such as PDF export, to enable their customers to pull data out of archived forms. It allows companies to organize their data digitally and make it usable and accessible. Also, it eliminates the manual data entry process. For instance, Philip Morris Products S.A., a Russian retail and consumer goods company, uses Smart Engines Service LLC’s identity document capture technology in its mobile survey application. It enables the collection of personal data of the respondents for verification purposes.

Global optical character recognition  market share, by end use, 2020 (%)

Business organizations are using OCR for information retrieval using searchable PDF format. Such software allows the conversion of image-only PDF files and paper documents into searchable files, including an invisible overlay containing searchable text to the scanned bitmap image of the paper document. It enables using a digital file system as a searchable database to find names, phrases, and keywords to help locate the information needed. Furthermore, government firms and officials use OCR solutions to scan legal documents, including driver’s licenses, insurance certificates, passports, and vehicle number plates.

Regional Insights

North America dominated the market in 2020, accounting for over 38% share of the global revenue. This can be attributed to the rising penetration of AI applications among other advanced technologies in the region. For instance, the American Foundation for the Blind, a U.S.-based non-profit organization, provides various assistive technology products, including OCR systems, for visually impaired people. Besides, in August 2020, Microsoft, the U.S.-based tech giant, released its latest technology called Read API to extract printed texts, handwritten texts, currency symbols from images, digits, and multi-page PDF documents.

The Asia Pacific regional market is expected to exhibit the highest CAGR of 19.4% over the forecast period. The growing technology industry in the emerging economies of Asia Pacific is particularly promoting the adoption of solutions with OCR capabilities. The regional market is witnessing heavy investments in AI and related technologies. For instance, in May 2020, DataGrand, a Chinese AI startup, has closed its B+ funding round worth USD 38 million, to scale up its business. The company focuses on the development of NLP and OCR, among other AI technologies. Besides, in April 2020, Cogent Labs Inc., a Japanese AI start-up, has raised a Series C funding round worth USD 13 million that brings its total funding to USD 39 million. The company offers Tegaki, an AI-based OCR service that scans handwritten documents.

Key Companies & Market Share Insights

Vendors active in the market are focusing aggressively on expanding their customer base and gaining a competitive edge over their rivals. Hence, they are pursuing various strategic initiatives, including partnerships, mergers and acquisitions, collaborations, and new product/ technology development. For instance, in July 2020, 3W Networks, a telecom & security systems integrator, partnered with Anyline GmbH, an Austria-based mobile text recognition company. This partnership is anticipated to bring innovative mobile scanning technology in the MENA (the Middle East & North Africa) region. It will enable businesses to digitize information, such as IDs, utility meters, and vehicle license plates, among others. Further, in May 2020, Deloitte collaborated with UiPath, global robotic process automation (RPA) company, to deliver DIDP (Deloitte Intelligent Document Processing). DIDP is a cloud-based or on-premises-based automation accelerator that captures documents before extraction, classification, and verification of their data for processing. Some of the prominent players in the global optical character recognition market include:

  • ABBYY

  • Adobe

  • Anyline GmbH

  • ATAPY Software

  • Captricity Inc.

  • Creaceed S.P.R.L.

  • CVISION Technologies, Inc.

  • Exper-OCR, Inc.

  • Google LLC

  • International Business Machines Corporation

  • IntSig Information Co.,Ltd. Corporation

  • IRIS S.A.

  • LEAD Technologies, Inc.

  • Microsoft

  • NAVER Corp.

  • Nuance Communications, Inc.

  • Open Text Corporation

Optical Character Recognition Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 8.92 billion

Revenue forecast in 2028

USD 26.31 billion

Growth Rate

CAGR of 16.7% from 2021 to 2028

Base year for estimation

2020

Historical data

2017 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Type, vertical, end-use, region

Regional scope

North America; Europe; Asia Pacific; South America; MEA

Country scope

U.S.; Canada; Mexico; Germany; U.K.; France; Italy; Spain; China; Japan; India; Australia; South Korea; Brazil; Argentina; Saudi Arabia; UAE

Key companies profiled

ABBYY; Adobe; Anyline GmbH; ATAPY Software; Captricity Inc.; Creaceed S.P.R.L.; CVISION Technologies, Inc.; Exper-OCR, Inc.; Google LLC; International Business Machines Corporation; IntSig Information Co., Ltd. Corporation; IRIS S.A.; LEAD Technologies, Inc.; Microsoft; NAVER Corp.; Nuance Communications, Inc.; Open Text Corporation

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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 2028. For this study, Grand View Research has segmented the global optical character recognition market report based on type, vertical, end-use, and region:

  • Type Outlook (Revenue, USD Million, 2017 - 2028)

    • Software

      • Desktop-based OCR

      • Mobile-based OCR

      • Cloud-based OCR

        • Private

        • Public

      • Others

    • Services

      • Consulting

      • Outsourcing

      • Implementation & Integration

  • Vertical Outlook (Revenue, USD Million, 2017 - 2028)

    • Retail

    • BFSI

    • Government

    • Education

    • Transport and Logistics

    • Healthcare

    • IT & Telecom

    • Manufacturing

    • Others

  • End-use Outlook (Revenue, USD Million, 2017 - 2028)

    • B2B

    • B2C

  • Regional Outlook (Revenue, USD Million, 2017 - 2028)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • Germany

      • U.K.

      • France

      • Italy

      • Spain

    • Asia Pacific

      • China

      • Japan

      • India

      • Australia

      • South Korea

    • South America

      • Brazil

      • Argentina

    • Middle East and Africa (MEA)

      • Saudi Arabia

      • UAE

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