Juniper Research is forecasting major growth in the digital identity verification market. The firm has specifically predicted that the amount of money that businesses spend on digital identity solutions will climb from $9.4 billion in 2021 to $16.7 billion in 2026.
That spend will correspond to a dramatic increase in the total number of identity checks. Global providers will be fielding 92 billion checks by the end of the forecast period, more than doubling the 45 million figure from 2021.
The actual money will come primarily from banks and other financial services organizations. The financial sector is expected to account for roughly 62 percent of that $16.7 billion, with Juniper noting that finance is more heavily regulated than other industries. As a result, financial institutions will embrace digital onboarding solutions as they search for ways to improve the customer experience while still providing a high level of security.
“Digital-only banks have shown that fully digital Know Your Customer can work and is very engaging for the user,” said Vladimir Surovkin, one of the co-authors of Juniper’s report on the digital identity verification market. “The pressure is on for traditional banks to deploy new identity verification services. Managing this transition quickly, and getting the user convenience/security balance right will determine overall success.”
Like many other organizations, Juniper pointed out that digital transformation accelerated during COVID-19, since lockdowns forced businesses to adapt to a remote work and consumer landscape. However, the firm also noted that that trend was already underway before the pandemic, and therefore cannot be entirely attributed to the coronavirus. Instead, Juniper argued that the growing interest in digital identity technology speaks to the demand for better user experiences, and that businesses will increasingly need to offer a low-friction digital services in order to retain their customers.
Juniper has previously predicted that biometrics will be used to authorize $3 trillion in payments by 2025. Facial recognition and behavioral biometrics are expected to be particularly popular with financial institutions.