Risk-based Authentication Market size is poised to grow at a high CAGR from 2018 to 2024 impelled by worldwide increasing adoption of advanced technologies including Internet of Things (IoT), Bring Your Own Device (BYOD), and connected devices. They offer various benefits to organizations such as reduced hardware costs, increased productivity for remote employees, and a satisfied customer base. However, the enhanced adoption of these connected devices has resulted in various privacy & data thefts and insecure usage causing data breaches & cyberattacks. Hence, enterprises worldwide are adopting the risk-based authentication solutions to curb the increasing threats of cyberattacks. The worldwide enterprise security spending is approximately USD 96 billion in 2018, which also augments the market growth.
risk-based authentication is a process of applying various levels of stringency to the authentication processes providing a higher security and risk threshold management with reduced costs. It assists in evaluating a set of factors related to transactions or access attempts to better evaluate the risks involved without causing any hindrance to the legitimate users. It also helps the organizations in maintaining the internal and external compliance regulations including HIPPA, FFIEC, PCI, and SOC. The stringent regulatory compliances for safeguarding the user data also augment the market growth. Around 30% of the B2E and B2B authentication was risk-based authentication in 2015, which is expected to grow rapidly over the forecast timespan.
The enhanced adoption of cloud-enabled risk-based authentication solutions displays huge market growth opportunities. They deliver enhanced operational efficiency with improved security and a better customer experience. They also provide other benefits such as reduced costs, economies of scale, centralized management, maintenance & reporting, and enhanced flexibility with no hardware deployment due to which their adoption is rising at a fast pace.
Various SMEs and public sector organizations lack complete knowledge about the benefits offered by the risk-based authentication solutions, restraining the market growth. The financial predicament among SMEs makes them use traditional security measures without spending additional funds to implement risk-based authentication solutions. However, the growing rate of cybercrime and the rising regulatory compliance standards have made it imperative for organizations and the public sector to adopt advanced solutions.
The solution segment is projected to grow at a higher CAGR as it assists enterprises to augment identity security, thereby safeguarding the users’ data from potential threats. These solutions combine strong risk-based authentication solutions to avoid data theft and frauds. Enterprises are also witnessing a rapid increase in the adoption of mobility-enabling partners, employees, and other stakeholders to access sensitive corporate data from any device. This has made the adoption of risk-based authentication solutions more critical from a business perspective.
The multi-factor authorization technology is anticipated to dominate the risk-based authentication market. It uses multiple authentication methods including biometrics, one-time password, security tokens, and Personal Identification Number (PIN), assisting organizations in preventing unauthorized access to sensitive information, thereby maintaining business security. As per the industry analysts, around 93% of the organizations are using multi-factor authorization technology. In December 2017, IBM Security integrated with four leading authentication providers to deliver more advanced multi-factor authentication capabilities to its customers through the IBM Security Access Manager (ISAM).
The BFSI sector dominates the risk-based authentication market ensuring compliance with regulatory mandates, strengthening security, and delivering enhanced digital services to its customers. In 2015, the worldwide credit card frauds amounted to USD 16 billion, which increased the adoption rate of risk-based authentication solutions in this sector. The healthcare sector is growing at a fast pace as risk-based authentication solutions assist healthcare providers in managing and validating their users’ identity.
Asia Pacific is considered the strongest region of growth in the risk-based authentication market due to an increase in the adoption of cloud-based solutions. Countries including India, China, Singapore, and Japan are rapidly adopting multi-factor authentication solutions to meet with the increasing regulatory compliances, which also augments the market growth. Furthermore, various companies operating in this region are spending huge funds on enterprise security to safeguard their business-critical information, driving the market.
The major players operating in the risk-based authentication include IBM, Micro Focus, CA Technologies, RSA Security, ForgeRock, SecureAuth, OneSpan, Gemalto, Okta, Oracle, Centrify, EZMCOM, Equifax, Lexisnexis, Gurucul, Ping Identity, Crossmatch, Silverfort, Iovation, and Biocatch. These players are entering into strategic partnerships to develop more advanced risk-based authentication solutions introducing enhanced security, thereby avoiding password fatigue and reuse. For instance, in May 2018, Nclose, a cybersecurity and managed detection & response provider entered into a partnership with Duo Security, a leading provider of two-factor authentication. This partnership will enable Nclose to deliver multiple factor authentications to its customers.