Multi-factor Authentication Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Multi-factor Authentication Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Multi-factor Authentication (MFA) Market is expected to register a CAGR of 18.5% during the forecast period. The increasing number of cyberattacks across enterprises is augmenting the market. Nearly half of all cyberattacks target small businesses, with the majority involving ransomware and the theft of corporate online and financial accounts.

Key Highlights

• OneLogin's authentication app, OneLogin Protect, allows users to verify their identities through smartphones. It also integrates with third-party authentication factors, like Google Authenticator and Yubico's YubiKeys, and provides a single sign-on option for the company's desktops.
• Demand for MFA is anticipated to rise due to the increase in online transactions and the high customer adoption rate of digital banking. Large organizations are being pushed to implement robust authentication procedures for consumers due to the surge in e-commerce and internet banking usage and mandated rules from central banks. The demand for OTP authenticators is expected to increase due to the increased use of mobile banking for online transactions (both hardware and software). MFA is used to ensure secure transactions and to safeguard clients from fraud and phishing scams. Additionally, integrating various payment systems in the healthcare, retail, and BFSI industries presents a potential opportunity for the MFA authentication industry.
• As per Google, the users who added a recovery phone number to their accounts (and indirectly enabled SMS-based MFA) also enhanced their account security. According to the company's study, adding a recovery phone number to Google Account can block up to 100% of automated bots, 99% of bulk phishing attacks, and 66% of targeted attacks during its investigation.
• During a global pandemic, the demand for remote work solutions has surged due to organizations transitioning from conventional workplace methods to work-from-home scenarios. These impacts must be thoroughly examined in the context of the organization's cybersecurity. As more and more personal unsecured devices start accessing the organization's network, the risk of compromising network security increases.
• The high cost of deploying MFA solutions is the major challenge businesses face when adopting these solutions. MFA solutions assist organizations and users in lowering the possibility of data loss. Due to budget constraints, these solutions are expensive for Small and medium enterprises. Furthermore, the costs of maintenance and timely upgrades add to the overall increase in an organization's expenses. The prices of software licensing, software maintenance, and user technical support are prohibitively expensive for low-budget enterprises to implement. The high cost of MFA solutions is due to various factors such as hardware tokens, software tokens, biometric authentication, and the requirement of certification in MFA to meet compliance standards.

Key Market TrendsBFSI Segment is Expected to Witness Significant Growth

• Because security is critical in the financial sector, allied banking firms have spent a significant portion of their budget on security. Payment and financial services, for example, account for approximately 75% of cyber-attacks in the United Kingdom. Such developments have a positive impact on the market. Some initiatives, such as the World Bank Group's Identification for Development (ID4D), attempt to assist developing countries in implementing new systems that increase the number of citizens with official identification by leveraging new technologies.
• The BFSI sector is witnessing an increase in cloud workloads, with a large amount of data being moved to the cloud. Furthermore, the increasing integration of third parties, such as mobile wallets, combined with complex security infrastructure in which many vendors are deployed throughout the ecosystem, poses a significant security challenge in the sector.
• As a result, BFSI enterprises should adopt a zero-trust security model that needs stringent identity verification for every user and gadget attempting to access resources. This must be enforced with multi-factor authentication (MFA), which ensures security by requiring more than one piece of evidence to authenticate a user.
• Financial information is one of the most sensitive pieces of information stored on the internet, and it is estimated that online identity fraud costs more than a trillion USD annually. As a result of this scenario, banks are investing heavily in authentication solutions, with an annual expenditure of more than USD 1 billion, accounting for approximately 30% of the total security budget of banks. Furthermore, one of the primary reasons customers use fintech solutions is the ease of account setup and KYC.
• In May 2022, according to UpGuard, the most significant data breach in the financial industry worldwide between 2008 and 2022 was found in 2019 in the United States at First American Financial Corporation. This data breach exposed 885 million financial and personal records. The financial sector is particularly vulnerable to cyber attacks that result in data breaches.

Asia-Pacific Expected to Witness Significant Growth

• The Asia-Pacific region is anticipated to be the fastest-growing region in the multi-factor authentication (MFA) market because of a higher level of implementation of bring your own device (BYOD) and choose your own device (CYOD) policies, as well as mobility services, which are increasing cyber-attacks and data breaches.
• CREALOGIX has released a solution to major banks in Asia, providing customers with one single app for banking and authentication. As part of a multi-factor authentication system, a hardware device no longer generates a One-Time-Password (OTP) hardware token for each action. The soft token takes the place of the hard token and offers all of the security benefits of multi-factor authentication.
• Asia Pacific is home to many well-established SMEs that deploy MFA to protect themselves against advanced cyber threats. Rising internet and smartphone penetration is a powerful driving force in the Asia Pacific, increasing the demand for effective MFA solutions and services. Security and fraud concerns have arisen as IoT, AI, and big data have increased. Regarding identity fraud, APAC's BFSI sector is the most targeted. This will increase the demand for MFA solutions in the region.
• Furthermore, hacking and monetary losses are on the rise in places like China. The primary goal of black hat hackers is to steal information for monetary gain. This is a primary consideration for all financial institutions because they control both personal and financial information. It is entirely simple for someone to capture the usernames and passwords of other people by employing various techniques such as sniffing, installing Keylogger, and so on.
• As of March 2021, 40,300 hacking attempts were suspected from entities in China to sabotage financial, utility, and infra services in the region. Moreover, companies realize that implementing two-factor authentication will reduce the losses suffered by financial institutions in terms of money and brand trust.

Competitive Landscape

The multi-factor authentication (MFA) market is moderately concentrated as the market includes global and regional players, where product penetration with the invention is rising. The key players are CA Technologies, Inc., Fujitsu Limited, Gemalto NV, etc. Recent developments in the market studied are

• February 2022 - Onfido, global identity verification and multi authentication company, stated that it had set 2021 as a breakthrough year. The company increased revenue by 90% yearly to above USD 100 million, including a 134% increase in the US. To fulfill the growing need for Onfido's verification and authentication services, the firm expanded its workforce while also investing in R&D, cutting-edge AI-powered fraudulent detection abilities, and consumer success for organizations worldwide.
• October 2021 - Secret Double Octopus, one of the prominent leaders in next-generation workforce authentication, reported the release of new multi-factor authentication (MFA) offerings as part of its Octopus Authentication Platform. Because the new options use the same components as the company's workforce passwordless MFA solution, enterprises can easily implement conventional MFA solutions with passwordless authentication capabilities.

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• The market estimate (ME) sheet in Excel format
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