Biometric System Market Size, Share, and Growth Analysis

Updated on : October 23, 2024

Biometric System Market Size & Growth

The global biometric system market size is expected to be valued at USD 47.2 billion in 2024 and is projected to reach USD 84.5 billion by 2029; growing at a CAGR of 12.3% during the forecast period from 2024 to 2029.

The increased adoption of biometrics in consumer electronics has emerged as one of the major growth drivers in the global biometric system market. This has been driven by increasing demand for security coupled with user convenience. Nowadays, fingerprint sensors and facial recognition technologies are very common in smartphones, laptops, and personal devices, thus fueling the demand for biometric systems. The rise of BaaS brings huge potential, especially for SMEs, to scale and cost-effective solutions without large upfront investments. Protecting sensitive biometric information and dealing with complex systems technically pose a challenge when technical expertise is at a premium; these issues play to significant barriers against mass adoption alongside growing data security and privacy-breaching concerns. Ensuring strong security measures and ensuring privacy is critical to establishing user trust and stimulating market growth.

Biometric System Market Trends:

AI Impact in the biometric system market

Introducing AI algorithms in biometric systems, such as deep learning, neural networks, and machine learning, has increased accuracy, speed, efficiency, and adoption. The advent of behaviour recognition has enabled a clear distinction based on patterns between living and deceased individuals. Machine learning techniques such as Artificial Neural Networks (ANN), Support Vector Machine (SVM), Deep Neural Networks (DNN), and Genetic Algorithms (GA) play an essential part in delivering non-common solutions for identification problems.

For instance, the facial recognition engine is part of Vision-Box's Seamless Journey Platform. This digital identity management platform connects multiple stakeholders throughout the traveller journey, enhancing security, customer experience, and operational efficiency by converting complex traveller data into a genuinely contactless, seamless travel experience.

Attractive opportunities in the biometric system market size

Biometric System Market Forecast to 2029

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Biometric System Market Dynamics

Driver: Growing adoption rate of biometrics in consumer electronics

One of the major growth determinants is the growing adoption rate of biometrics in consumer electronics, as this enhances convenience and security for the user. From the early days with smartphones and tablets to today with laptops, the majority of devices have integrated biometric features such as fingerprint and facial recognition as a secure mode of access and authentication. This has been driven by the need for improved data security, as well as frictionless user experience that is devoid of the voltage experienced with passwords. Diffusion and stretching have further reached devices such as smart home devices and wearables for secure access and personalization into everyday technology. Further, biometric authentication facilitates safe mobile and online transactions by removing fears of the growth of cyber threats and identity theft. Biometric sensors and algorithms keep improving, raising their accuracy and reliability, hence the appeal to both consumers and manufacturers. Thus, the demand for biometric systems within the consumer electronics segment never stops and has contributed much to the growth of the market.

Restraint: High costs associated with biometric systems

High costs associated with biometric systems as one of the major restraints of the biometric system market. These involve advanced hardware and software in the initial investment, including installation, integration, and maintenance-related costs. The latter are quite high for many organizations, particularly for small and medium-sized enterprises, since upfront costs are too big for them to afford these technologies.Added to these are high operating costs, including updating the system, data storage, and security measures to protect sensitive biometric data. Another significant factor that contributes to the rise in costs is the high degree of complexity, and integration with the existing infrastructure necessitates specialized technical skills of the highest order. Moreover, huge costs connected with compliance and related stringent regulatory standards, together with the necessity of regular audits on data privacy and security, may deter some businesses from investing in biometric systems. Hence, such financial barriers slow down the pace of wide-scale adoption and implementation of biometric technologies in different sectors.

Opportunity: Increasing adoption of Biometric-as-a-Service (BaaS)

Increasing adoption of Biometric-as-a-Service (BaaS) is a huge opportunity for the market of biometric systems by scaling the cost-effective solution for organizations of all sizes. BaaS enables organizations to leverage biometric authentication and identification technologies through cloud-based platforms, removing large upfront investments usually required in hardware and infrastructure.This model gives flexible, on-demand access to the newest fingerprint, facial, and voice recognition biometric features according to business requirements. Maintenance, updates, and security are carried out by BaaS providers and put less of a technical burden on clients' sides. In this way, one makes sure that all regulatory standards are followed while it is safer to protect the data due to state-of-the-art safety measures in place. With this, BaaS is going to be very attractive to any business that intends to improve its security given the easy integration with previously existing systems and the scaling of services depending on demand. As more organizations begin to realize the benefits of adopting BaaS, the biometric system market will grow tremendously based on this innovative service model.

Challenge: Data security and inadequate technical expertise

The major concerns that pose challenges to the biometric system market lie in data security and inadequate technical expertise. The biometric systems have very high sensitivity to personal information; therefore, they are always threatened by cyberattacks and data breaches. Strong security measures have to be in place to protect biometric data, which is impossible in many organizations due to the lack of technical expertise required to implement and maintain the respective systems effectively. The very complexity of biometric technologies necessitates special knowledge in terms of their installation, integration, and operation, hence forming a barrier to smaller enterprises with limited resources. Besides, cyber threats keep evolving; therefore, security protocols need continuous updating and monitoring, which requires further investment in skills and infrastructure related to cybersecurity. Finally, regulatory compliance—organizations must navigate too many rigorous data protection laws. The integration of these factors consequently inhibits the wide acceptance of biometric systems as businesses measure the potential risks and technical difficulties against the benefits that could accrue from implementing such technologies.

Biometric System Market Ecosystem

The biometric system market share is dominated by established and financially sound manufacturers with extensive experience in the industry. These companies have diversified product portfolios, cutting-edge technologies, and strong global sales and marketing networks. Leading players in the market include Thales (France), IDEMIA (France), NEC Corporation (Japan), ASSA ABLOY (Sweden), and Fujitsu (Japan), among others.

Biometric System Market Segmentation

Multi-factor authentication segment in the biometric system market is anticipated to grow with the highest CAGR

Multi-factor authentication accounts for the highest growth rate in the market due to increased implementation across industries because of its developed security features. As it is self-explanatory, multi-factor authentication combines two or more modes of verification, such as biometric recognition (fingerprint, facial, or iris) together with passwords or tokens, which provides better security compared to a single-factor authentication process. This advanced security then becomes critical in industries like banking and finance, healthcare, and government—industries wherein the leakage of information is very undesirable. Organizations are looking to implement MFA solutions as extra security for systems and data in view of the ever-increasing cyber threats and data breaches. Furthermore, the regulatory mandates and compliance requirements are enforcing companies to have stronger authentication methods that will provide further growth impetus to MFA in the biometric system market.

The software offerings to dominate the biometric system market over the forecast period

Software can be expected to grow with the highest growth rate during the forecast period in the market because it has been at the forefront of enhancing the functionality and adaptability of biometric hardware. Advanced software solutions open up more sophisticated and accurate biometric recognition algorithms; hence, their deployment within applications like mobile devices, security systems, and identity verification platforms will increase. Finally, the trend of biometric solutions is moving toward cloud-based and AI-driven technologies, further increasing demand for software. That's because technologies like these give users scalability, real-time processing, and improved security features. Besides these benefits, the fact that software can be easily integrated with other existing systems and has regular updates and improvements makes it very suitable for businesses looking to upgrade their biometric capabilities. In this respect, the reliance on software-driven solutions underlines its important and accelerating market growth.

The Consumer electronics vertical exhibit second highest CAGR in the biometric system market

Consumer electronics vertical segment is expected that the software segment of the biometric system market will grow at the fastest rate during the forecast period because it has been driving the development in functionality and flexibility of biometric hardware in the recent past. Sophisticated and more accurate algorithms for biometric recognition are enabled by advanced software solutions; thus, their implementation in various applications, such as mobile devices, security systems, and identity verification platforms, will increase correspondingly. Finally, biometric solutions are trending toward cloud-based and AI-driven technologies, further increasing demand for software. That is because technologies such as these give users scalability, real-time processing, and improved security features. Other than that, since it can be easily integrated with other existing systems and has regular updates for improvements, it will be very suitable for any business looking to upgrade their biometric capabilities. In this regard, the dependence on software-driven solutions underlines its key to accelerating market growth.

Biometric System Industry Regional Analysis

Asia Pacific region in biometric system industry to dominate the market growth

The Asia Pacific holds the largest market share in biometric systems, due to the rapid growth of the economy, extensive technological development, and huge government-sponsored programs. Countries such as India and China top the board in the adoption of biometric systems with their national ID programs like Aadhaar, coupled with wide adoption across the banking, healthcare, and security sectors. Furthermore, large population and increasing smartphone penetration act as additional factors driving demand for biometric technologies integrated into consumer electronics. Growing focus toward smart city projects and digital transformation in various industries across the Asia Pacific region is also driving demand for biometric solutions. In addition to this, supportive government policies and heavy investments being done in security infrastructure are some of the other key factors contributing to establishing the leading position for this region in the biometric system industry.

Biometric System Market by Region

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Top Biometric System Companies - Key Market Players

• Thales (France), 
• IDEMIA (France), 
• NEC Corporation (Japan), 
• ASSA ABLOY (Sweden),
• Fujitsu (Japan) are among the major players in the biometric system companies.

Biometric System Market Report Scope

Biometric System Market Highlights

The study categorizes the biometric system market size based on the following segments:

Recent Developments in Biometric System Industry

• In January 2024, IDEMIA has introduced VisionPass SP, a new facial recognition access control solution that offers accurate and fair matching in under a second, even in various lighting conditions. The compact, eco-friendly device integrates advanced AI and facial recognition algorithms, along with robust security measures to prevent cyber-attacks. VisionPass SP maintains high security standards while enhancing user experience.
• In January 2024, NEC Corporation has been commissioned to install joint Immigration & Customs Declaration KIOSKs at Haneda Airport Terminal 2 by Japan's Immigration Services Agency and Customs. These KIOSKs aim to streamline procedures with pre-registered information, enhancing efficiency amid increasing international visitors and Japan's goal of accommodating 60 million by 2030.
• In October 2023, Thales has collaborated with SoyYo which is a digital identity provider for companies in Colombia. The company is to introduce FIDO2 passkeys for passwordless authentication in Colombia, enhancing security and user experience for millions. This implementation, leveraging biometrics or device codes, will also bolster Thales' biometric solutions by integrating them into secure, passwordless access.

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