The Electronic identification market was valued at US$39.010 billion in 2019. Electronic Identification has been gradually wiping the legacy identification solutions out of the market and this phenomenon is anticipated to pick up more pace as we move ahead in a technology-intensive ecosystem. Legacy identification ecosystem includes paper-based identification documents that are offered by businesses or various agencies which are authorized by governments for the purpose.
Although this trend still holds significant traction in countries which still do not have the infrastructure required for making the switch to the digital ecosystem, many developed countries are already near to a completely digital environment. Many developing countries are also sprinting towards this modern practice and their drift is expected to pick up speed over the projected period. The demand for electronic identification is being driven by the increasing focus of many governments on minimizing their expenses which are mostly constituted by operations. This concern is not confined to developed economies as both developing and underdeveloped economies also continue to feel burdened by their operational expenditures. Malaysia’s operating expenses, for instance, have been eating away more than 90% of every ringgit the government has made over the past few years and this spending is now outgrowing the pace of revenue generation by the government.
As a result, the country will have to continue relying on borrowing in order to fund these expenditures. As these expenditure burdens are being experienced by many economies worldwide, drift towards a digital ecosystem is gaining momentum. The integration of advanced technologies into various functions in order to streamline the overall process is one way to go in the new ecosystem. With many functions across departments headed by governments witnessing this transformation, identification documents are also being transformed. Reduction in the use of paper and other resources for issuing identification documents, coupled with a significant reduction in requirement of the human workforce is increasing the popularity of electronic identification, thus boosting the market growth. The corporate sector is also making a significant contribution to this market growth as the incorporation of advanced technologies into business functions is increasing. BFSI is one of the major contributors to this growth as electronic identification solutions are being used for various applications across this industry. From identity management and access control to transaction management, these solutions are transforming the workflow in this sector, thus augmenting the market growth.
The rising incidence of security breaches is pushing both government agencies and businesses towards taking strong measures in order to prevent such events. High losses associated with such breaches is one of the prime concerns for governments and business owners. Loss of customers’ trust and even higher loss of business, coupled with huge regulatory fines and remediation costs together scale up the damage caused by security breaches. For governments, loss of sensitive or classified information, on account of unauthorized access into facility or system can have far-reaching consequences. The losses might not be limited to financial losses and may extend to risks to national security According to an estimate by the IBM, the global average cost of a data breach stood at US$3.92 million in 2019. Increasing the focus of these end-users towards minimizing such losses is increasing the need among them for stronger and breach-proof identification solutions, thus boosting the market growth. In order to tap the growth potential this market holds, many players have entered this market and offer solutions to end-users across all key markets. Investments by these market players into research and development are bringing about improvements in security and thus reliability of electronic identification solutions, thus increasing their adoption among end-users. The recent outbreak of the COVID-19 pandemic is also anticipated to shape the market growth over the projected period. Since governments are seeking ways to extend relief to every individual who has been hit by the pandemic, lack of effective identification solutions are needed in order to ensure that people in need are getting the help they require. This will continue to drive market growth over the forecast period.
The electronic identification market has been segmented on the basis of offering, end-user, and geography. By offering, the market has been segmented into solutions and services. By the end-user, the global electronic identification market has been segmented into government and corporate.
North America holds a significant share in the global electronic identification market
Geographically, the electronic identification market is segmented as North America, South America, Europe, the Middle East, and Africa (MEA), and Asia Pacific (APAC). To give a clearer view of these regional markets, these have been further segmented into countries that account for a significant market share. North America and Europe together account for a fairly large market share and market growth in these regions is expected to remain decent over the forecast period. The availability of favorable technology infrastructure in these regions is one of the major factors supporting the market growth. Furthermore, since many economies in these regions are known to show early adoption of new technologies, they have the early adopter benefit and hold a fairly decent market share. The market growth in the Asia Pacific is anticipated to remain solid over the projected period. Evolving technology infrastructure in countries like India in this region is poised to add momentum to the growth of the regional market. The rapid growth of industries in this region, on account of the inflow of huge investments into various sectors, is driving with it the use of electronic identification among offices and other facilities, thus supporting the market growth. South America and the Middle East and Africa account for a relatively small market share and the market growth in these regions is expected to remain good over the forecast period.
Prominent key market players in the electronic identification market include Electronic Identification, Finansiell ID-Teknik BID AB, IDEMIA, Thales Group, X Infotech and Telecolor India Pvt Ltd. These companies hold a noteworthy share in the market on account of their good brand image and quality of offerings. Many major players in the electronic identification market have been covered along with their relative competitive position and strategies. The report also mentions recent deals and investments of different market players over the last two years.
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