Digital Identity Market Size, Share, Growth, And Industry Analysis, By Type (Biometrics, Non-Biometrics), By Application (Multi-Factor Authentication, Single-Factor Authentication), Regional Forecast To 2034

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DIGITAL IDENTITY MARKET OVERVIEW

The global Digital Identity Market size stood at USD 51 billion in 2025, growing further to USD 280.8 billion by 2034 at an estimated CAGR of 20.87% from 2025 to 2034.

The United States Digital Identity Market size is projected at USD 19.37127 billion in 2025, the Europe Digital Identity Market size is projected at USD 14.15358 billion in 2025, and the China Digital Identity Market size is projected at USD 7.44657 billion in 2025.

The global COVID-19 pandemic has been unprecedented and staggering, with digital identity experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden rise in CAGR is attributable to the market's growth and demand returning to pre-pandemic levels once the pandemic is over. 

A digital identity is the collection of data that exists online about an individual, organization, or electronic device. People or their devices can be identified using unique identifiers and usage patterns. Site owners and advertising companies frequently use this information to identify and track people for customization and to end up serving them aimed content and advertising.

It develops organically as a result of the consumption of personal information found on the internet and the shadow data generated by the individual's online actions. It can be anything from a Pseudonymous profile connected to the device's IP address to a randomly generated unique ID. Because a user provides significant data when providing authentication information, digital identities are viewed as contextual in nature.

KEY FINDINGS

COVID-19 IMPACT

Interruption in Supply Chains to Decline Market Share 

The eruption of coronavirus illness (COVID-19) did act as a humongous restriction mostly on digital identity market in 2020, as supply chains have been interrupted because of international limitations and utilization has declined due to global government lockdowns. COVID-19 is an extremely contagious disease characterized by flu-like symptoms such as fever, coughing, and difficulty breathing. The virus was discovered in Wuhan, and has since spread throughout the world, which include West Europe, Asia, North America. Covid-19 has had a significant impact on a number of industries. A shutdown, boundary shutdown, lockdowns, followed by other forms of suppression have only exacerbated the situation. To cope with this pandemic scenario, all travel and outdoor activities were suspended. Because of health and safety concerns, all of the individuals were staying at home, which has a negative impact on the market. Due to the global lockdown caused by the Covid-19 pandemic, the production of different goods inside the market has been halted. This has hampered the growth of the market in recent months and is expected to continue in 2021.

LATEST TRENDS

Retail Sectors to Intensify Market Magnification

Digital identity solutions have been successfully incorporated in the network of retail sectors, supporting business stability and increasing competitiveness. Retail is among the most cost-conscious industries, and it is also one of the most targeted for hacking attacks because of possible payouts and a large number of monetary transactions via Visa and Mastercard. The retail and ecommerce sectors have enormous digital identity market potential. The growing complexity of the supply chain, staff, channel partners, and customers are driving retail outlets to adopt controlled authentication services. Third-party applications help ecommerce businesses manage their websites, third-party distributors, worker access points, and the growing Internet of Things (IoT) based devices, including printers and video surveillance.

• India’s Digi Yatra facial recognition system deployed across 28 airports, covering 90 % of domestic air traffic as of mid‑2024.

• Over 1 billion logins to Italy’s SPID eID system were recorded in 2022 under the eIDAS scheme.

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DIGITAL IDENTITY MARKET SEGMENTATION

By Type Analysis

According to type, the market can be segmented into biometrics, non-biometrics

Biometrics is the leading part of the type segment

By Application Analysis

According to application, the market can be segmented into multi-factor authentication, single-factor authentication

Multi-factor authentication is the leading part of the application segment

DRIVING FACTORS

New ID Wallet Alternatives to Boost Market Share

New ID wallet alternatives are providing a significant boost to digital identifying schemes around the world. This new technology defines a secure mobile app for storing digitalized and encrypted versions of identity documents, such as a driver's license, transportation card registration, healthcare credentials, and so on. In other sense, citizens will be able to access all of their ID credentials from a solitary, safe source for identifying and ID verification facilities. With these wallets, the bearer can share only what is required to verify a transaction. Citizens can use such wallets to prove their identity and rights to law enforcement personnel, healthcare professionals, and other citizens both online and in person. The European Commission recently proposed generating an electronic Identity wallet which could be used in June 2021 all over the EU region. Therefore, the new ID alternatives will boost the digital identity market share.

Cloud-Based Digital Identity Solutions to Expand Market Forwarding

Rather than trying to implement the software solution on local equipment, businesses adhere to the possible answer hosted on a third-party remote location’s server in the cloud-based deployment mode. The cloud is the fastest-growing segment, with numerous digital identity market growth opportunities. By utilizing cloud-based identity solutions, organizations can avoid certain costs such as infrastructure maintenance and technical staff costs. Cloud-based platforms are advantageous for organizations with limited security investment budgets. SMEs use the cloud to deploy digital identification because it allows them to concentrate on their core strengths rather than investing capital in security infrastructure.

• 5 % of global annual sales lost to identity fraud cost, per ACFE, boosting digital identity investment.

• In U.S., over 349 million records were exposed in 3,122 data breaches during 2023, highlighting need for stronger digital ID systems.

RESTRAINING FACTORS

Data Breaching to Deplete Market Advancement

When it comes to digital identities, including facial recognition, people are hesitant to share their facial data for fear of it being misused. San Francisco was the first city to completely prohibit the utilization of facial recognition in government and federal-related operations. Latin American and African countries are particularly vulnerable to this threat. The identity information is kept in databases so that people can gain access whenever they enter a location. These databases contain personal information about citizens including the social security number and bank account information. As a result, citizens are concerned that by granting access to digital identities, personal data could be violated, compromised, and misused, potentially causing harm to citizens. As a result, citizens' reluctance to allow the utilization of digital identities is yet another challenging issue in the adoption of digital identification. Businesses and governments should engage target consumers more actively and educate them on the benefits of the government's use of digital identities. People will be more willing to adopt digital identification once they have gained trust in the safety of their digital identities.

• Germany’s eID-enabled ID cards: 14 % usage rate of eID function in 2023 despite availability to 11.6 million users.

• Widespread user skepticism: 29 % of passengers at Delhi airport reportedly enrolled in Digi Yatra unknowingly, raising consent concerns

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DIGITAL IDENTITY MARKET REGIONAL INSIGHTS

Increased Rate of Identity Thefts to Foster Market Growth in North America and Asia Pacific

North America is made up of developed countries with advanced technology and well-developed infrastructure. The United States and Canada, with their largest economies, are the top contributors in North America to the growth of the digital Identity market. The emerging economies of the United States and Canada allow them to invest massive sums in these new technologies. Identity theft is increasing, which is trying to drive the implementation of these digital identification. According to the (Identity Theft Resource Center), the number of data breaches in the United States will increase by 68% in 2021. The figure has been 23% more than the previous high.

Companies and organizations prevailing in Asia Pacific region has raise the requirement for digital identification and is therefore proved to be beneficial for the market outlook.

KEY INDUSTRY PLAYERS

Key Players Focus on Partnerships to Gain a Competitive Advantage

Prominent market players are making collaborative efforts by partnering with other companies to stay ahead of the competition. Many companies are also investing in new product launches to expand their product portfolio. Mergers and acquisitions are also among the key strategies used by players to expand their product portfolios.

The analyst provides a comprehensive picture of the market through the study, synthesis, and summarization of data from various sources, as well as an examination of important variables such as financial gain, sales prices, competition, and promotions. It identifies the key industry influencers and presents various market facets. The information provided is thorough, reliable, and the result of extensive primary and secondary research. The market report provides a comprehensive competitive landscape as well as an in-depth vendor evaluation methodology and analysis based on both qualitative and quantitative studies to accurately forecast market growth.

The reports cover important advances with in market, as well as inorganic and organic growth strategies. Various companies are concentrating on organic business expansion such as product announcements, product approvals, and other things like patents and events. Acquisitions, partnerships, and collaborations were among the inorganic growth strategies observed in the market. The above activities have paved the way for market participants to expand their business and customer base. With the growing demands for filter products in the international market, market participants in the market are expected to benefit from substantial growth opportunities in the near future.

• Thales: Recognized in ecosystem as a top supplier of digital identity hardware systems.

• RSA: Cited among leading vendors in identity management and authentication services globally.

List of Top Digital Identity Companies

• THALES
• RSA
• Digital authentication
• Accenture PLC
• Imprivata, Inc.
• OneLogin, Inc.
• CyberArk
• Shanghai Pala Software Co., LTD
• Entrust
• Okta, Inc.
• Suan Times Technology Co., LTD
• Jumio Corporation
• GB GROUP PLC
• Cisco Systems, Inc.
• Trulioo
• IDEMIA
• Ping Identity
• NEC Corporation

REPORT COVERAGE

The industry's growth was significantly influenced by the tactics employed by market participants in recent years, such as extensions. The report provides details and information on the companies and their interactions with the market. The data is gathered and published through appropriate research, technological advancements, expansions, and expanding machinery and equipment. Other criteria considered for this market are the firms that develop and provide new products, the areas in which they operate, mechanisation, innovative techniques, making the most money, and using their products to have a large social impact. This analysis examines the global and regional effects of the outbreak mostly on the market. The study describes the market share features, and market growth by type, industry, and customer sector.

This research profiles a report with extensive studies that take into description the firms that exist in the market affecting the forecasting period. With detailed studies done, it also offers a comprehensive analysis by inspecting the factors like segmentation, opportunities, industrial developments, trends, growth, size, share, restraints, etc. This analysis is subject to alteration if the key players and probable analysis of market dynamics change.