Increased Digitalisation and Growing Number of Fraudulent Operations to Fuel Growth of Identity Verification Market
Identity verification has been around for a long time. Civilisations have come up with all sorts of documentation to prove an individual’s identity - take school cards and passports for instance. However, with unprecedented Internet penetration, people can easily fake their personal data nowadays. There are countless tools that can be used to present fake documents. Even identity theft has also become more common. Personal and financial information of the victims are being used to commit fraud and other crimes. This can pose a big challenge not just for authorities and businesses but also for consumers. Identity verification is at the forefront of deterring fraudsters and putting a stop to identity theft. It allows businesses to fully integrate digital or online solutions without worrying about data breaches. This is expected to push demand, thereby driving the growth of identity verification market.
The growing number of fraudulent operations, such as identity theft, and cyberattacks due to an increase in digitalisation with electronic ID cards (eID) and smart infrastructure initiatives, can be related to the expansion of identity verification market. According to the Consumer Sentinel Network of the United States Federal Trade Commission (FTC), the overall number of identity theft cases recorded in the United States in 2020 was 1387615, accounting for 29.39% of all other categories. Identity verification market is also proliferating because of the growing awareness among businesses, and government organisations about the surging significance of using identity theft protection services to avoid fraudulent actions.
Government authorities all around the world are working to create tough legislation to combat identity theft and to bring the entire world's population under the legal identity umbrella. In September 2020, LoginID Inc. and Ipsidy Inc. forged a partnership to develop new solutions to prevent online fraud. The firms will offer FIDO2 authentication and login services with better security and a high level of identity trust by combining Ipsidy's biometric identity verification platform with LoginID's FIDO as a Service platform.
Various government and corporate initiatives focusing on digitalisation, and the use of emerging technologies such as AI, machine learning, and automation in identity verification systems will present lucrative prospects for identity verification suppliers. The market is also expected to expand as governments throughout the world take more steps to establish stringent rules and handle the growing threat to Internet security. Several countries throughout the world are rapidly using solutions like know your customer (KYC) and anti-money laundering (AML). The fifth anti-money laundering directive (AML5) was implemented by the European Union, lowering the identity verification threshold for the prepaid card industry from EUR 250 to EUR 150. In January 2020, the directive went into effect in all member states.
Increased Digitisation of Banking Procedures Drives the Growth of BFSI Category in Identity Verification Market
BFSI category is expected to dominate the global identity verification market over the forecast period. Increased digitisation of banking procedures, such as digital onboarding and digital payments, is pushing the demand for identity verification across the world. Because of its high technological adoption, the vertical is vulnerable to several security flaws that hackers could use to steal sensitive data such as personal information, bank account information, and credit card numbers. Financial institutions are always seeking security solutions to mitigate such vulnerabilities, which will boost the identity verification industry in the future. In addition, strict rules such as the Bank Secrecy Act, GDPR, and PSD2 are increasing the demand for identity verification worldwide.
Increased Technological Advancements in North America to Drive Identity Verification Market
North America is expected to contribute the highest share in global identity verification market in terms of revenue over the forecast period as it is a technologically advanced region with a high number of early adopters, and the presence of significant market players. The demand for identity verification is expected to be driven by factors such as the development of government initiatives such as smart infrastructure, smart cities, and digital identity-based driver's license, as well as the increasing integration of various technologies such as AI, ML, and blockchain for securing digital identities.
The US is dominating the identity verification market in terms of installation. It is a technologically advanced country in North America with a high level of investment in innovative technology and the adoption of advanced solutions. Factors such as the increasing digitisation of company processes and the growing need for smart identity verification solutions among organisations to ensure effective and risk-free business operations are driving the identity verification market forward. The availability of stringent government rules and laws to limit cybercrime activities, as well as the growing prevalence of identity thefts in the region, are primarily responsible for the growth of identity verification market across the region. According to Consumer Sentinel Network of the FTC statistics, the overall number of frauds, identity theft, and other reports recorded in the United States increased from 325519 incidents in 2001 to 4720743 cases in 2020.
The market in Asia Pacific is expected to grow at a significant rate. With increased internet coverage in India and China, the region is one of the fastest users of technology. As these emerging economies embrace digitisation, the risk of customer data and data channel breaches has increased. In the region, there has been an increase in demand for identity theft prevention solutions. Furthermore, Singapore, one of Asia's most advanced nations in the digital banking sector, has Asia's broadest range of digital solutions. Singapore has the second-highest proclivity for digital banking in the world. Singapore, on the other hand, is becoming more exposed to cyberattacks as the number of global firms in the country grows. In 2020, the SingPass digital identification technology, which provides safe digital signatures for property caveats, was implemented by the Singaporean government. By 2023, residents should be able to execute 90 percent to 95 percent of their e-government transactions without leaving their homes, according to the digital government strategy. This project should enable digital document signing on a variety of devices.
Global Identity Verification Market: Competitive Landscape
Companies in the market are introducing new products alongside initiation collaborations, alliances, and partnership agreements. In November 2021, Experian introduces Work Report, a digital verification solution that will allow consumers to consent to the digital sharing of their payroll information with another firm. It connects to an employer's payroll data to provide instant confirmation of a consumer's gross and net income, as well as their job status and tenure. On the other hand, in June 2020, GBG collaborated with CredoLab to analyse the creditworthiness of any Indonesian citizen, including the unbanked and underbanked, utilising GBG's digital/AI-driven risk management.
A few of the players in the identity verification market include Experian (Ireland), GBG (UK), Equifax (US), Mitek Systems (US), Thales Group (France), LexisNexis Risk Solutions (US), Onfido (UK), Trulioo (Canada), Acuant (US), IDEMIA (France), Jumio (US), TransUnion (US), AU10TIX (Israel), IDology (US), Innovatrics (Slovakia), Applied Recognition (Canada), Signicat (Norway), SecureKey (Canada), IDfy (India), Authenteq (Iceland), Veri5Digital (India), PXL Vision (Switzerland), IDMERIT(US), Shufti Pro (UK), Idenfy (Lithuania), WebID (Germany), IDnow (Germany), Signzy (India), and Passbase (Germany).
Regional Classification of the Global Identity Verification Market is Listed Below:
Middle East and Africa
*Regions and countries are subject to change based on data availability.
Key Elements Included In The Study: Global Identity Verification Market
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