Global Multi-Factor Authentication Market  By Authentication Type (Password Authentication and Passwordless Authentication), By Model Type, By Component, By Enterprise Size, By End-User,  By Region and Companies - Market Assessment, Competition Scenario, Trends, and Forecast 2023-2032

Report Overview

In 2022, the Global Multi-Factor Authentication Market was valued at USD 12.5 billion it will reach USD 49.7 billion by 2032. Between the forecast period, this market is estimated to register the highest CAGR of 15.2%.

Multi-factor authentication (MFA) is an authentication method in which users provide two or more verification factors to log in to a specific resource. In a multi-factor authentication system, the user might be asked to enter a code sent via their email, a secret answer to any question, fingerprint, and iris scanning.

OTP is a multi-factor authentication designed to provide high security from hackers to protect information. Multi-factor authentication offers a variety of choices to meet security needs and helps to meet regulatory requirements. Multi-factor authentication protects companies and sites from cyber attackers. Due to increasing cyber-attacks and security issues, companies and businesses are shifting towards multi-factor authentication systems to overcome cyber-attacks and secure their private data.

Note: Actual Numbers Might Vary In The Final Report

Key Takeaways

• Market Growth: The global Multi-Factor Authentication Market is expected to grow significantly, with an estimated value of USD 49.7 billion by 2032, exhibiting a Compound Annual Growth Rate (CAGR) of 15.2%.
• Drivers: Increasing Governmental Activities Regarding Safety of Data: Rising instances of data breaches and the adoption of Bring Your Own Device (BYOD) trends have led to a surge in demand for multi-factor authentication systems.
• Authentication Type Analysis: The password-less authentication segment holds the largest market share, attributed to its robust security features, including the use of biometrics like fingerprints and facial scanning.
• Model Type Analysis: The five-factor authentication segment holds the largest market share, owing to its high accuracy and low susceptibility to cyber-attacks.
• Component Analysis: Dominance of Hardware Segment: The hardware segment holds the largest market share, primarily due to the use of biometric authentication methods such as fingerprints.
• Enterprise Size Analysis: Large enterprises hold the largest market share, driven by the need to mitigate risks associated with stolen passwords and to enhance data security.
• End-User Analysis: The Banking, Financial Services, and Insurance (BFSI) segment holds the largest market share, owing to the high sensitivity of data and the need for robust security measures.
• Regional Analysis: North America accounts for the largest revenue share, driven by advancements in research and development (R&D), higher technological adoption rates, and an increasing number of cyber-attacks.
• Key Market Players: Leading companies such as OneSpan, RSA Security LLC, NEC Corporation, Symantec Corporation, Gemalto N.V., and others are focusing on strategic initiatives such as mergers, investments, and acquisitions to strengthen their positions in the market.

Drivers

Increasing Governmental Activities Regarding Safety of Data

Increasing instances of data breaches and rising adoption of BYOD trends are the main factors driving the growth of the multi-factor authentication market. The worldwide number of online services and financial organizations is increasing. Due to this governments are rapidly adopting digital identities to provide consumers with easy and faster access to services.

Organizations are adopting stronger identity verification measures to protect sensitive data from hackers. Governmental policies such as General Data Protection Regulation(GDPR) for data security implemented by the European government resulted in organizations adopting advanced consumer data security measures.

Technological Advancements and Rising Demand in Banking Sectors

Increasing adoption of smartphones and faster 5G services are driving the need for multi-factor authentication systems. Also, digital banking and online payment methods are increasing rapidly. Due to this, there is a high demand for multi-factor authentication systems in e-commerce companies and baking sectors to provide secure and safe transaction methods.

Additionally, increasing healthcare, IT & telecommunication, media & entertainment industries are driving the demand for multi-factor authentication methods. Also, the increasing trends toward the Internet of Things (IoT), cloud-based MFA, and blockchain services are driving the global market. Furthermore, individuals adding their recovery contact information to their google account blocks 100% automated tools and reduces about 95% of cyber-attacks by using one-time password (OTP) authentication, driving the growth of the multi-factor authentication market.

Restraints

High Implementation Costs and Security Issues

High initial costs for the implementation of multi-factor authentication systems are the primary factor restraining the market growth. High maintenance and software update costs also restrain the market growth. Increasing cyber-attacks result in data privacy loss, which negatively impacts market growth.

Authentication Type Analysis

The Passwordless Authentication Segment is Dominant in the Market

Based on authentication type, the market is classified into password authentication and passwordless authentication. The passwordless authentication segment was dominant in the market with the largest market revenue share of 58% and is anticipated to remain dominant in the market during the forecast period.

Passwordless authentication is harder to crack than traditional passwords, and it is less prone to cyber-attacks which is the main growth factor of this segment. It uses fingerprints, facial scanning, and biometrics other than traditional passwords, which provides high privacy and security. Also, passwordless authentication improves the cybersecurity approach for businesses because it reduces security issues and unauthorized access compared to password authentication.

Password-based authentication is the most common method of authentication in the majority of small and medium organizations. It uses a username and password to get access. Password authentication is expected to show slow growth due to the high risk of cyber-attacks and low privacy regarding data.

Model Type Analysis

Five-Factor Authentication Segment is Dominant in the Market

By model type, the market is segmented into two-factor authentication, three-factor authentication, four-factor authentication, and five-factor authentication. The five-factor authentication segment was dominant in the market with the largest market share of 31% and is anticipated to remain dominant in the market during the forecast period owing to its high accuracy and very low risk regarding cyber-attacks.

Five-factor authentication systems use knowledge, possession, inherence, location, and behavior factors to give access to the specific business site. In knowledge-based authentication requires remembering passwords or PINs.

Many organizations are using five-factor authentication systems to control access to secure data systems and applications. The two-factor authentication(2FA) also plays an important role in web security and data privacy protection. 2FA systems have large applications in the IT and telecommunication industries due to the need for advanced privacy systems. In addition, three-factor authentication (3FA) provides the highest possible level of user security to access accounts and make transactions.

Component Analysis

Hardware Segment was Dominant in the Market

Based on components, the market is segmented into solutions, hardware, and services. The hardware segment was dominant in the market with the largest market share of 34% and is anticipated to remain dominant in the market during the forecast period due to high security.

Hardware authentication requires biometrics authentication, such as fingerprints, to get access, which is the main growth factor of the segment. Bank ATM is an example of hardware authentication in which a user needs a card with a PIN to withdraw cash.

Enterprise Size Analysis

The Large Enterprises Segment was Dominant in the Market

Based on enterprise size market is classified into small & medium enterprises and large enterprises. The large enterprise segment was dominant in the market, with the largest market share of 64%, and is anticipated to remain dominant in the market during the forecast period.

MFA in large enterprises enhances organizations’ security and protects organizations from cyber-attacks. The two-factor authentication systems have large applications in large enterprises because they reduce the risk associated with stolen passwords. The expansion capacity of small enterprises is increasing due to this small enterprise rapidly adopting multi-factor authentication systems to protect data and privacy.

Note: Actual Numbers Might Vary In The Final Report

End-User Analysis

BFSI Segment to Be a Major Contributor in End-User Application

Based on end-user, the market is segmented into travel & immigration, military & defense, BFSI, government, commercial security, healthcare, media & entertainment, IT & telecommunication, and other end-users. The BFSI segment was dominant in the market, with the largest market share of 25% in 2022. It is anticipated to remain dominant in the market during the forecast period.

BFSI uses multi-factor authentication that requires users to provide two or more verification factors to access a resource, such as an online application, a VPN, and an online account. The banking industry is facing the problems of cybercrime and fraud, and due to this, banking industries started adopting multi-factor authentication methods.

MFA plays an important role in securing data in military and defense sectors which are highly sensitive. Multi-factor authentication prevents terrorists from entering military base camps. Introduction to the internet of things(IoT) and cloud-based authentication methods, several industries such as healthcare, media & entertainment are rapidly adopting multi-factor authentication systems to get advanced security for their sensitive data.

Key Market Segments

Based on the Authentication Type

• Password Authentication
• Passwordless Authentication

Based on Model Type

• Two-Factor Authentication
• Three-Factor Authentication
• Four-Factor Authentication
• Five-Factor Authentication

Based on component

• Solution
• Hardware
• Services

Based on enterprise Size

• Small & Medium Enterprises
• Large Enterprises

Based on End-User Industry

• BFSI
• Government
• Travel & Immigration
• Military & Defense
• Commercial Security
• Healthcare
• IT & Telecommunication
• Media & Entertainment
• Other End-Users

Opportunities

Governmental Activities Protecting Consumers’ Sensitive Data

The multi-factor authentication (MFA) market is growing due to increasing cyber-attacks and concerns regarding consumer data safety. The rising adoption of smartphones, increasing online payment methods, and rising trend of digital banking are anticipated to create lucrative growth opportunities in the global multi-factor authentication market.

Governments in the United States recently announced that MFA sign-in methods are required for all federal agency staff to protect private data. Companies require to sign in via MFA other than just using a username and password. Increasing cyber-attack issues are anticipated to drive the global MFA market during the forecast period. The governments in economies are increasing their investments aimed at improving BFSI facilities & infrastructure to provide a privacy policy.

Trends

Increasing Popularity of One Time Password (OTP) Among Consumers

Banking and financial services started adopting multi-factor authentication systems to protect data and overcome cyber-attacks.  CREALOGIX, which is a provider of banking and wealth management solutions, launched a single app for banking and authentication.

Consumers worldwide are more inclined towards online payment methods, which have increased the risk of data privacy. Due to this, the demand for multi-factor authentication is increasing in online payment methods. Also, the popularity of one-time passwords (OTP) is increased among consumers because it provides high-class authentication and 100% privacy and security.

Regional Analysis

North America was dominant in the multi-factor authentication market, with the largest revenue share of 38% in 2022. It is anticipated to remain dominant in the market during the forecast period. In North America, the advancements in R&D facilities and the technological adoption rate is greater. Increasing issues of cyber-attacks increased the demand for multi-factor authentication solutions in North America. Also, major key players such as Vasco Data Security International, Inc., RSA Security LLC, and CA Technologies are expected to fuel the market in North America. The adoption of cloud-based MFA solutions is driving the need for MFA in the region.

Furthermore, increasing numbers of mobile users with penetration of e-commerce also boosts the demand for multi-factor authentication solutions in several emerging economies such as Brazil, India, South Africa, and China. Also, increasing investments in IOT and cloud services are driving the MFA market in the Asia Pacific region.

Note: Actual Numbers Might Vary In The Final Report

Key Regions and Countries Covered in this Report:

• North America
  • The US
  • Canada
• Europe
  • Germany
  • France
  • The UK
  • Spain
  • Italy
  • Russia
  • Netherland
  • Rest of Europe
• APAC
  • China
  • Japan
  • South Korea
  • India
  • Australia
  • New Zealand
  • Singapore
  • Thailand
  • Vietnam
  • Rest of APAC
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East and Africa
  • South Africa
  • Saudi Arabia
  • UAE
  • Rest of MEA

Key Players Analysis

Top key players are focused on a variety of strategic policies to develop their respective businesses in foreign markets. Several MFA solutions companies are focusing on market strategies such as mergers, investments, and acquisitions. MFA solutions providing companies are working on the improvement of authenticity to provide a standard security platform to their consumers.

Market Key Players

Listed below are some of the most prominent multi-factor authentication market players.

• OneSpan
• RSA Security LLC
• NEC Corporation
• Symantec Corporation
• Gemalto N.V.
• Micro Focus
• HID Global
• Oracle Corporation
• Secret Double Octopus
• Microsoft Corporation
• Duo Security
• Broadcom Inc.
• Okta, Inc.
• Other Key Players

Recent Developments

• In 2022, Microsoft became the fourth-highest global brand valuation in Multi-factor Authentication.
• In September 2020, Symphony Technology Group completed its acquisition of RSA from Dell Technologies. RSA Security LLC. Became an independent company, which is the world’s largest cyber security organization.

Report Scope