Global Biometric-as-a-Service (BaaS) Market Research Report: Forecast (2022-2027)

Market Definition

Biometrics involves using a person's biological & physical characteristics, such as the face, fingerprints, or iris, to recognize them in a reliable & automated manner. Biometrics as a Service (BaaS) is a cloud-based framework to promote new biometric recognition for law enforcement, access control, healthcare, financial services, etc. The use of the BaaS model to enhance cybersecurity across end-users like offices, hospitals, airports, defense, etc., is significantly supporting the growth of the BaaS market globally.

Market Insights

The Global Biometric-as-a-Service (BaaS) Market is projected to grow at a CAGR of around 19.78% during the forecast period, i.e., 2022-27. The market growth imputes primarily to the increasing use of Bring-Your-Own-Devices (BYOD) in organizations, coupled with the mounting data security issues globally, which have led to an increased usage of cloud-based mobile biometric services.

According to the World Internet Stats 2021, there are around 5.1 billion mobile & internet subscribers globally. With the surging number of mobile & internet subscribers and the increasing instances of internet frauds & cyberattacks, there is an urgent need to deploy biometric solutions in vital industrial verticals globally. The mounting application of biometrics technology across commercial centers, offices, & airports, coupled with the soaring application of finger & facial scan solutions in the security & defense sectors, are other prominent factors contributing to the growing demand for biometric sensors globally. 

Additionally, growing number of identity thefts & terrorist acts due to the burgeoning usage of online banking services have raised some serious concerns over national security across different regions, which, in turn, has augmented the need for biometrics in vital sectors. Furthermore, factors like the increasing number of e-passport programs entwined with various initiatives by governments worldwide toward enhancing cybersecurity measures have contributed to a surge in the revenue of Biometric as a Service (BaaS) providers. For instance:

• In 2019, the US government announced a budget of USD 15 billion for cybersecurity, of which the US Department of Defense (DOD) reported an investment worth USD 8.5 billion in cybersecurity. This boost in government initiatives & funding toward cybersecurity worldwide is another crucial aspect expected to drive the global market during 2022-27.

Key Trends in the Global Biometri-as-a-Service (BaaS) Market

Rising Government Initiatives toward Integrating BaaS into Prominent Industrial Verticals

Integration of biometric services with cloud-based platforms, such as Biometric-as-a-Service (BaaS), is presently the keen focus area of the eminent end-user industries & small vendors due to burgeoning instances of payment frauds & data breaches worldwide. Cloud-based security services offer organizations various advantages like lowered costs, enhanced flexibility, better disaster recovery related to data breaches, and agility without involving any complex infrastructure.

• 19 of the 24 US government agencies use biometric security services like facial recognition systems across their respective organizations, cites the Government Accountability Office (GAO). These include the US Department of Defense (DOD) & Department of Homeland Security (DHS) that maintain in-house systems and other smaller agencies with access to high-security locations across the US.
• In November 2020, the Ministry of Russia announced to build a database of fingerprint, DNA, & face biometric data collected from Russians & foreigners. This software that will identify people by face, voice, iris, & even gait biometrics is expected to go live for the new Federal Information System of Biometric Accounting (FISBA) by the end of 2023.

Several initiatives by governments worldwide to tackle identity-related frauds, specifically for strengthening e-KYC to authenticate identities of different citizens at airports, banks, healthcare, & other economic sectors, shall increase the revenue of BaaS providers during the forecast period. 

Impact of Covid-19 on the Global Biometric as a Service (BaaS) Market

The Covid-19 pandemic in 2020 bought several security challenges related to biometrics security in various verticals, such as defense, banking & finance, government, healthcare, etc. According to BAE Systems, around 74% of the global financial institutions reported frequent cyberattacks amidst the global crisis. Additionally, Carbon Black, Inc. reported a 238% increase in cyberattacks against banks & financial institutions globally.

As a result, the demand for enhanced biometric security solutions rapidly surged and fueled the market growth. Furthermore, the growing demand for advanced biometrics for disease detection using face recognition, coupled with systems that can analyze behavioral patterns & emotional/psychological states to monitor, predict & anticipate incidents, are expected to gain significant traction during 2022-27.

Market Segmentation

Based on the Component:

• Services
• Solutions

Of them all, the Services segment is expected to gain significant momentum in the Global Biometric as a Service (BaaS) Market during 2022-27. With the growing digitalization and increasing use of IoT in industries like manufacturing, agriculture, logistics, banking, etc., there exists a need for these sectors to deploy enhanced security services to help reduce those security breaches which could cause operational losses.

Increasing cyberattacks & internet scams across these sectors have contributed extensively to an increasing demand for advanced biometrics solutions & services to ensure data security and the smooth functioning of business operations. Government organizations globally have adopted significant initiatives to curb data security losses. For instance:

• In August 2021, the US Federal Bureau of Investigation (FBI) announced to build Next Generation Identification (NGI), a biometric identification database program for around 18,000 local, state, tribal, federal, & international service partners currently using Integrated Automated Fingerprint Identification System (IAFIS).

Based on Trait

• Physiological
  • Face Recognition
  • Fingerprint Recognition
  • Iris Recognition
  • Palm and Vein Recognition
  • Others
• Behavioral
  • Voice Recognition
  • Signature Recognition
  • Others

Of them all, the Behavioral segment is expected to acquire a considerable market share during 2022-27, owing to the burgeoning demand for digitally integrated technologies across a variety of industries, such as banking, government, manufacturing units, etc., coupled with the growing number of behavioral thefts. Biological biometrics is a powerful tool for tackling advanced threats in these industries. It analyzes parameters like a user's keystrokes when typing, navigational patterns, screen pressure, typing speed, etc. Moreover, the surging adoption of digitally integrated solutions & services like Digital Banking has also contributed to a revenue surge for the Biometric as a Service industry worldwide.

• According to Feedzai, a global financial risk management company, financial institutions globally saw a 259% increase in banking fraud attacks in Australia in 2020.

Cyber attackers & fraudsters are constantly developing different tactics to adapt to changes in the banking sector and exploit weaknesses & vulnerabilities of the industry. Account Takeover (ACTO) is one of the incipient fraud trends emerging globally. Besides, TransUnion, a global credit bureau, also detected a surge in fraudulent & criminal activities related to financial services in the South African region, with a 187% increase in 2020 from 2019. Furthermore, rising Authorized Push Payment (APP) frauds & identity thefts from e-commerce platforms are expected to boom the demand for Behavioral Biometrics globally.

Regional Landscape

Based on the Geography, the Biometric as a Service (BaaS) market expands across:

• North America
• South America
• Europe
• Asia-Pacific
• Middle East & Africa

Geographically, among all countries, North America is expecting to portray a noticeable growth in the Biometric as a Service (BaaS) Market during 2022-27. With the increasing technological advancements, cyber-attacks are also rising in the North American region. Besides the prominent financial, tech, telecommunication companies, the government is also actively opting for various cyber security measures. Besides, the Department of Homeland Security in the US also uses biometrics to detect & prevent illegal entries, facilitate legitimate travel & trade, enforce federal laws, etc.

• In November 2021, two American government biometrics contracts( one federal & one state) were announced. The first contract, won by 'Idemia Identity & Security North America,' is to support enrollment services offered by the state of Indiana. The second contract (federal) won by Accenture Federal Services involves updating & expanding systems used by the US Marshals Service.

Hence, this boost in investments in the Biometric as a Service Market by private sectors & governments worldwide for National security would drive the North America Biometric as a Service (BaaS) Market in the years to come.

Recent Developments

Thales Group:

• In December 2021, France's Thales company signed a memorandum of understanding with Saudi Telecom Company (STC) to collaborate on a broad range of technologies, including digital identity solutions, e-SIMs, national security technologies, smart cities, etc.
• In February 2021, Thales introduced Thales Cogent Palm Scanner CS500q in its portfolio, a scanner with a design, acquisition speed, and many different image acquisition enhancements.
• In May 2020, Thales introduced the Cogent Fingerprint Scanner CSD101i, a single-digit fingerprint scanner housed in a durable, compact casing.

Market Dynamics:

Key Driver: Digitalization and Growing Security Threats

The growing dependence on technology of the key industries, such as e-commerce, banking, security, etc., has urged the need for enhanced security mechanisms, which, in turn, has resulted in the increased integration of biometric services globally. Moreover, the mounting need to strengthen national security in many countries is also augmenting the demand for Biometric-as-a-Service (BaaS) models.

Governments worldwide are using BaaS to identify illegal immigrants, criminals, etc. For example, over 150 countries have adopted e-Passport programs, a combination of paper & electronic passports containing biometric identification information stored on an embedded microchip. It is for more accurate authentication of the identity of travelers while maintaining their privacy & the highest level of security.

Industries like healthcare, IT, banking, etc., are also shifting toward BaaS for more privacy & fewer security threats and are investing extensively in enhancing security systems. Moreover, the mounting demand for fingerprint scanning biometric solutions for payments & banking services is another crucial aspect positively influencing the global market. For instance:

• In January 2021, What’s App launched a privacy measure, which allows users to secure their accounts through biometric authentication.

The increasing need to secure online transactions, surging security threats, and mounting adoption of advanced technologies by governments to create awareness among citizens and promote digitalization is anticipated to propel the overall market growth during 2022-27.

Possible Growth Restraint: Increasing Security & Privacy Concerns Due to Data Theft Incidences

Service providers need to be careful regarding the biometric authentication methods they use in order to prevent violations of customers' privacy or exposure of their personal information since this information could be stolen or lost if the cloud isn’t well-secured. Due to these reasons, consumers & enterprise organizations hesitate while adopting BaaS solutions.

According to Varonis, a US-based data security & insider threat detection company, around 10 million identities have got stolen since 2013, and nearly 64% of them occurred in the United States. Hence, increasing concerns over the security of biometric data stored in the cloud might challenge the Biometric as a Service Market growth during 2022-27.

Key Questions Answered in the Research Report:

1. What are the overall statistics or estimates (Overview, Size- By Value, Forecast Numbers, Segmentation, Shares) of the Global Biometric as a Service (BaaS) Market?
2. What are the region-wise industry size, growth drivers, and challenges?
3. What are the key innovations, opportunities, current & future trends, and regulations in the Global Biometric as a Service (BaaS) Market?
4. Who are the key competitors, their key strengths & weaknesses, and how do they perform in the Global Biometric as a Service (BaaS) Market based on the competitive benchmarking matrix?
5. What are the key results derived from surveys conducted during the Global Biometric as a Service (BaaS) Market study?

Market Outlook, Segmentation, and Statistics

• Impact of COVID-19 on Global Biometric as a Service (BaaS) Market
• Market Size & Analysis
  • By Revenues (USD Billion)
• Market Share & Analysis
  • By Component
    • Solutions
    • Services
  • By End Users
    • Banking and Financial Services
    • Government
    • IT/ITES
    • Healthcare
    • Manufacturing
    • Energy & Utilities
    • Retail
    • Others (Transport, Entertainment, etc.)
  • By Trait
    • Physiological
      • Face Recognition
      • Fingerprint Recognition
      • Iris Recognition
      • Palm and Vein Recognition
      • Others
    • Behavioral
      • Voice Recognition
      • Signature Recognition
      • Others
  • By Organization Size
    • Small & Medium Enterprises
    • Large Enterprises
  • By Region
    • North America
    • South America
    • Europe
    • Middle East & Africa
    • Asia Pacific
  • By Company
    • Competition Characteristics
    • Market Share of Leading Companies, By Revenues
  • Global Biometric-as-a-Service (BaaS) Market Regulations & Policies
  • Global Biometric-as-a-Service (BaaS) Market Supply Chain Analysis
  • Global Biometric-as-a-Service (BaaS) Market Hotspots & Opportunities