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Digital Identity Verification Market to Reach $16.7B

As more enterprise organizations embrace the ongoing transition to digital business transformation, CIOs and CTOs are adopting new technologies that enable the secure identification of individuals within their key stakeholder communities.

A "digital identity" is a unique representation of a person. It enables individuals to prove their physical identity during transactions. Moreover, a digital identity is a set of validated digital attributes and credentials for online interactions -- similar to a person's identity within the physical world.

Individuals can use a 'digital ID' to be verified through an authorized digital channel. Usually issued or regulated by a national ID scheme, a digital identity serves to identify a unique person online or offline.

Digital Identity Systems Market Development

Complementary to more traditional forms of identification, digital identity verification systems can enhance the authenticity, security, confidentiality, and efficiency of identifying people.

According to the latest worldwide market study by Juniper Research, spending on digital identity verification by businesses will reach $16.7 billion in 2026 -- that's up from $9.4 billion in 2021.

Digital identity verification is where identity is checked using verifiable elements -- such as selfie scans, address checks, and knowledge-based authentication. The 77 percent market growth will be fuelled by the need to onboard new users, which has accelerated during the global COVID-19 pandemic.

The study identified that, while the pandemic accelerated digital transformation, many industries had already increased digitization -- reflecting demand for solutions to improve operational efficiency.


Juniper analysts believe that secure digital onboarding is the minimum requirement in the post-pandemic environment, with user expectations demanding processes that are low friction and high security.

The new research study findings also found banking and financial service institutions will account for almost 62 percent of digital identity verification investments from businesses by 2026.

This importance reflects how critical digital verification systems are to help banks meet mandatory government regulatory requirements within a complex digital business applications environment.

"Digital-only banks have shown that fully digital 'Know Your Customer' can work and is very engaging for the user, therefore 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," said Vladimir Surovkinat, an analyst at Juniper Research.

Juniper found the global volume of identity verification checks will exceed 92 billion in 2026 -- that's up from 45 billion in 2021. While financial services are major drivers of growth, the broadening of identity verification into remote onboarding for mobile network operators will create significant opportunities over the next five years.

Outlook for Digital Identity Applications Growth

According to the Juniper assessment, enterprises across the globe are increasingly spending on the transformation of their businesses -- including their payment and verification processes. Digital identity is an emerging market segment centered on distinct, coordinating, and sometimes overlapping solutions.

The ID verification market is witnessing a paradigm shift from manual identity verification systems to those based on electronic credentials. Due to the COVID-19 pandemic, 2020 became a year of change where expectations for online identity verification rapidly accelerated.

I believe that digital identity verification applications could also become a component of enterprise IT solutions that are tailored specifically for distributed workforce onboarding, as more people choose to work from their homes. Let's wait and see what happens next in this emerging space.

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