The global multi-factor authentication market is projected to be worth USD 20.38 billion by 2025. The demand for multi-factor authentication is expected to grow significantly over the coming years due to rising investments in cloud technologies, enterprise mobility, and increasing adoption of Bring-Your-Own-Devices (BYOD) across enterprises.
Rising internet users coupled with increase in use of digital payments is expected to create demand for multi-factor authentication system. Breaching of financial data is a potential threat to banking and FinTech companies, owing to which banking and financial companies are integrating two-factor and multi-factor authentication in the process of digital payment. Moreover, security and privacy threats through malware are constantly growing. For instance, total malware attacks reported in 2017 was USD 9.32 billion all across the world, a rise of 18.4% from 2016. This, in turn, is expected to boost the demand for the global multi-factor authentication market.
Multi-factor authentication helps to increase the overall security, by adding more security layers in collaboration with one time password, such as face recognition, fingerprint and retina scanner. Multi-factor authentication models are classified as 2FA, 3FA, 4FA and 5FA. As of 2017, two-factor authentication is widely used by government, healthcare sector, financial sector and other industry sectors. For instance, Facebook, LinkedIn, Gmail, Drop Box, PayPal and others have two-factor authentication as a built in feature to enhance security.
The application of three-factor authentication is increasing as two-factor authentication is not capable of handling increasingly aggressive threats, such as phishing, ATM skimming and malware. For instance, as per Kaspersky Lab’s findings, financial phishing attacks accounted for over 50% among all the phishing attacks in 2017. Typically, four-factor and five-factor authentication systems are used in government and defense sectors, where high level of security is needed for applications, such as access to national files, data, homeland security services and others. Four-factor and five-factor models together accounted for 12.8% of the global multi-factor authentication market share in 2017.
In 2017, US dominated the multi-factor authentication system in North America region due to strict compliance to government security policies. Asia Pacific is expected to grow at the highest CAGR of 24.8% during the forecast period. The numerous industries present in India, China and Japan such as banking, defense and healthcare are adopting more secure technology for transactions. For instance, India’s UID project “Aadhaar”, is one of the biggest MFA projects in the world, registering more than 1 billion people. In the Middle East numerous industries such as banking and defense are adopting more secure technology for transactions. For instance, Saudi Arabia’s AL Rajhi Bank; Isbank, Turkey’s largest commercial bank, and others in the Middle East have integrated multi-factor authentication systems with their existing security systems to provide customers secure access to account using mobile applications.
The multi-factor authentication market is highly competitive and consists of numerous players. Launch of new products, acquisitions and expansions, strategic partnerships are the few strategies used by the key players in the market.
- In September 2017, RSA integrated with Microsoft Azure Active Directory to provide two-factor authentication to their client
- In January 2018, HID launched an updated version of Credential Management System (CMS). The new ActivID CMS 5.0 authenticates users without using a physical smart card.
- In May 2018, Okta eliminated passwords with stronger authentication in its new adaptive Single Sign-On product and enhanced adaptive MFA products, backed by new Okta ThreatInsight.
Key segments of the global multi-factor authentication market
Model overview, 2015–2025 (USD million)
- Two-factor authentication (2FA)
- Three-factor authentication (3FA)
- Four-factor authentication (4FA)
- Five-factor authentication (5FA)
Application overview, 2015–2025 (USD million)
- Banking, Financial Services and Insurance (BFSI)
- Retail and e-commerce
Regional overview, 2015–2025 (USD million)
- North America
- Rest of the world
- Latin America
- Middle East