Identity Verification Market Trends Report, Size, Share & Growth Forecast 2030

[Research Report] The identity verification market size was valued at US$ 9.16 billion in 2022 to US$ 31.95 billion by 2030; it is estimated to record a CAGR of 16.9% from 2022 to 2030.

Analyst Perspective:

The global identity verification market size is majorly driven by the growing number of cyberattacks, rising adoption of security solutions, and surging demand for secure transactions in the BFSI sector, among others. Key trends witnessed in the identity verification market are the integration of AI and other advanced technologies for the monitoring of alerts and pattern-based data. With the rapidly changing nature of businesses, there is a rise in the requirement for new developments in technology and services. Also, the rapid digitalization among small and medium-sized enterprises (SMEs) is likely to provide substantial opportunities for identity verification market players in the coming years.

Identity Verification Market Overview:

Identity verification solution is software that helps governments and businesses to identify or validate individual identities. They get affirmation about the user identity to gain trust if an online or offline individual is genuine or not. There are several types of identity verification, which include a biometric scanner, one-time password, iris scanner, and knowledge-based verification, among others. The sales of identity verification solutions depend on numerous economic and noneconomic factors. The BFSI and government sectors are expected to have significant impact on the growth of the identity verification market as these sectors deals with crucial and sensitive information about people. Also, the healthcare industry is increasingly adopting digitalization, thereby providing advanced services to its customers.

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Identity Verification Market: Strategic Insights

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Identity Verification Market Driver:

Rise in Demand from BFSI Sector Drives Identity Verification Market Growth

Over the years, financial regulators have intensified their focus on monitoring fraud activities, which also includes a rise in the adoption of suitable security solutions by financial institutes. Furthermore, the regulators expects from the firms to be capable of functioning the system appropriately and efficiently. This demand for sophisticated transaction monitoring systems would be predominantly driven by legislation like New York State's Department of Financial Services (NYSDFS) part 504 focused to prevent money-laundering activities from occurring within the state of New York. Thus, to secure processes in the BFSI sector, there is an increase in the use of identity verification solutions. For example, in July 2020, Wibmo Inc. launched Wibmo Video-KYC, a video-based KYC solution, to enable banks and financial service providers to reach their customers digitally. In addition, in May 2023, Mastercard launched the "Open Banking for Account Opening" solution to take new customers on board. This solution uses Mastercard package customer identity verification with identity insights in a single API for flexible and easy onboarding of customers and protection against fraud.

The importance of secure transaction platforms has gained traction over the years, which enables financial institutions to configure a range of monitoring scenarios, perform efficient data analysis, and filter out actual suspicious activities from other false positives. Real-time identity verification with video-based KYC is one of the best solutions provided by the identity verification system to avoid and detect threats if they occur. BFSI is a crucial sector that deals with customer money and trust. The need to secure it is necessary due to potential cybersecurity threats, which is leading to the adoption of identity verification solutions. According to Regula, ~44% of respondents in a survey and 80% of organizations in the Finance and Technology fields validated that they deal with more verification cases concerning foreign documents. Thus, the broad adoption of identity verification solutions in the BFSI sector fosters the identity verification market growth.

Identity Verification Market Report Segmentation and Scope:

The identity verification market is segmented based on component, deployment, organization size, type, industry vertical, and geography. Based on component, identity verification market is bifurcated into solution and services. Based on deployment, identity verification market is divided into cloud and on-premise. Based on organization size, identity verification market is segmented into large enterprises and SMEs. Based on type, identity verification market is categorized into biometric verification. online verification, knowledge-based authentication, and others. Based on industry vertical, identity verification market is segmented into BFSI, government and defense, healthcare, IT and telecom, retail, and others. Regionally, the identity verification market is segmented into North America (the US, Canada, and Mexico), Europe (the UK, Germany, France, Italy, Russia, and the Rest of Europe), Asia Pacific (China, Japan, India, Australia, South Korea, and the Rest of Asia Pacific), the Middle East & Africa (South Africa and the Rest of Middle East & Africa) and South America (Brazil, Argentina, and the Rest of SAM).

Identity Verification Market Segmental Analysis:

Based on component, the identity verification market is segmented into solution and services. The software segment held the largest share in the identity verification market in 2022. Identity verification solutions permit businesses to enhance customer conversions by offering an efficient customer experience and reducing fraud. Identity verification solutions are integrated with advanced technologies such as biometrics, machine learning, and artificial intelligence. They also help customers meet regulatory compliance. Digital identity verification, identity authentication, and ID verification are the majorly used identity verification solutions. The growing cybercrimes globally forced the market players to adopt digital identity verification solutions to catch fake IDs, reduce risk and minimize fraud in online transactions. The identity authentication solutions verifies the users' identity to implement secure identification and payment applications. Similarly, ID verification solutions are used to verify the user identity by data scanning, face detection, and many more to decrease fraudulent activities and permit the business to operate smoothly and more profitably.

Identity Verification Market Regional Analysis:

In 2022, North America held the largest global identity verification market share. North America is one of the fastest-growing regions in terms of both technological innovations and the adoption of advanced technologies. The region also has a well-established IT and cloud infrastructure. In the past three years, the region has witnessed significant adoption of emerging technologies such as artificial intelligence and blockchain across all the major industry verticals. With the increasing penetration of digitization in various industries, identity verification has become a vital component of business transaction ecosystems, especially in financial institutions and online retail. The demand for identity verification solutions in companies is increasing rapidly as these solutions allow companies to comply with various rules and regulations. A few of these regulations include anti-money laundering (AML), know your customer (KYC), and digital fraud prevention. The North America identity verification market growth is primarily driven by rising demand from industrial sectors such as BFSI, government, defense, and healthcare, where correct identification of users and customers is a crucial business requirement for successful operations. In 2018, North America contributed the largest market share in terms of overall revenue of the global identity verification market, and it is estimated to continue its dominance during the forecast period.

Various identity verification players are present in North America such as Acuant Inc. and Trulioo. The US-based company, Acuant Inc., offers an identity verification solution—AssureID—for document & identity authentication. This solution is used across various industry verticals to authenticate user information. Similarly, a Canada-based company, Trulioo, offers identity verification solutions for various purposes, including identity authentication, know your customer (KYC) and anti-money laundering (AML) compliance, fraud prevention, and auditing. In addition, many start-ups have been entering the marketplace with their innovative identity verification solutions that are integrated with artificial intelligence and other advanced technologies. All the above mentioned factors are anticipated to boost the adoption of identity verification solutions in North America from 2022 to 2030.

Identity Verification Market Key Player Analysis:

Trulioo; Onfido; Mitek Systems, Inc; IDology; Authenteq; Experian Plc; Thales SA; IDEMIA; Jumio Corporation; and LexisNexis Risk Solutions Group are among the key companies operating in the identity verification market.

Identity Verification Market Regional Insights

The regional trends and factors influencing the Identity Verification Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Identity Verification Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.

Identity Verification Market Market Report Scope

Market Players Density: Understanding Its Impact on Business Dynamics

The Identity Verification Market market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.

Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.

Major Companies operating in the Identity Verification Market are:

1. Trulioo
2. Onfido
3. Mitek Systems, Inc
4. IDology
5. Authenteq

Disclaimer: The companies listed above are not ranked in any particular order.

Identity Verification Market Recent Developments: 

Inorganic and organic strategies such as mergers and acquisitions are highly adopted by companies in the Identity Verification Market. A few recent key Identity Verification Market developments are listed below:

• In September 2023, UK-based Know Your Customer (KYC) marketplace company Magic partnered with automated identity verification provider Onfido. The primary goal of the joint venture is to offer both document and biometric verification services for KYC processes and, consequently, help mitigate fraud.
• In March 2023, Mitek, a global leader in digital identity verification, joined the Open Identity Exchange (OIX), a global community for all ID sector stakeholders to connect and collaborate, developing the guidance needed for interoperable, trusted digital identities.
• In January 2023, Trulioo launched an industry-defining global identity platform for person and business verification. The Trulioo platform showcases the company's expertise and innovation in helping businesses worldwide build trusted user experiences while achieving regulatory compliance and optimizing growth.
• In August 2023, Canada-based Trulioo has added new capabilities to its Workflow Studio platform for faster identity verification, while new deals for Shufti Pro and iDenfy and a product launch from Vouched demonstrate the broad applicability of selfie biometrics.