Tokenization Solution Market Size, Share, Growth and Industry Analysis by Type (On-Premises, And, Cloud) By Application (Retail & E-Commerce, Transportation & Logistics, BSFI, It & Telecommunications, Healthcare, Government, Energy & Utilities, And, Others) Regional Forecast To 2033

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TOKENIZATION SOLUTION MARKET OVERVIEW

The tokenization solution market, valued at USD 3.31 billion in 2024, is forecasted to grow consistently, reaching USD 4.05 billion in 2025 and ultimately hitting USD 20.18 billion by 2033, at a steady CAGR of 22.3% from 2025 to 2033.

Tokenization solutions are primarily services that help in finding solutions to protect and maintain confidentiality regarding cardholder data, primary account number, magnetic swipe data, and most importantly cardholder information.

The Payment Card Industry Data Security Standard (PCI DSS) has imposed certain strict rules and regulations to ensure safety of card users. This is identified as the latest trend in the market currently.

Tokenization solution avoid any breach of data and protect the privacy of the users. Cloud-based tokenization is a very popular form of tokenization.  All of these factors can be considered as the factors driving the tokenization solution market growth.

COVID-19 IMPACT

Increased Adoption of Online Banking During Pandemic Supported Market Growth

COVID-19 disrupted the functioning of several industries across the world to several reasons like decrease in the demand for products, health and economic crisis, shortage in raw materials, labor, and social distancing norms. This also gave way to the development of digitalization.

Difficulty in mobility was the main reason for people to opt for online banking and transactions. Online transactions save time and allow users to use all the financial services without the need to go visit actual bank.  This also increased the risk of frauds. Hence, a lot of companies started adopting tokenization solutions to protect cardholder data and information. This increased the demand for tokenization service during the pandemic period.

LATEST TRENDS

Rules Imposed by PCI DSS Regarding the Safety of Cardholders to Increase Market Growth

Many precautions have been taken up to provide security to the cardholders. In order to further increase the confidentiality, the Payment Card Industry Data Security Standard (PCI DSS) has imposed certain strict rules and regulations.

According to these rules all the organizations that transfer, accept, or hold any cardholder’s data must take active steps in providing security to the cardholder’s data. In order to do this the organizations must abide by the rules and accept incoming payments through credit cards. Networks that are properly secured must to be set up and there must be a regular update in the database of the retailer. These developments can be observed to be the latest trend in the market.

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TOKENIZATION SOLUTION MARKET SEGMENTATION

By Type

The market can be divided on the basis of type into the following segments:

On-premises, and, cloud. The on-premises segment is anticipated to dominate the market during the forecast period.

By Application

Classification based on application into the following segment:

Retail & e-commerce, transportation & logistics, BSFI, it & telecommunications, healthcare, government, energy & utilities, and, others. The retail segment is predicted to dominate the market during the research period.

DRIVING FACTORS

Reduction of Risk from Data Breaches Due to Tokenization Solutions to Accelerate Market Growth

The most important tasks of tokenization solution are to avoid any breach of data and protect the privacy of the users. Hackers mainly target those organizations that take credit and debit cards. This can put such organizations at risk. Installation of tokenization can reduce the risks of such thefts.

Data is completely secure from the point of data capturing and collection to its storage. Even in case of any information breach the valuable information of the user will not be revealed. Tokenization will eliminate the storage of any card numbers within the internal storage system or even in the POS machine system. These factors will accelerate the tokenization solution market share.

Rising Scope for Technologies Like Cloud-based Computing in Tokenization Service to Propel Market Growth

Tokenization service is integrated with several technologies to increase its efficiency, and, accuracy.  Cloud-based tokenization has become very popular recently. This type of tokenization is the process of transferring data that is highly sensitive to a placeholder who is non-sensitive and irreversible. This placeholder is addressed by the name token.

The data that is exchanged is usually stored outside of the organization’s system. Cloud-based tokenization is an easier and affordable option compared to others. The business organization does not have to compromise with the utility or agility of its business processes to protect the data. The convenience of using cloud-based tokenization is propelling market growth.

RESTRAINING FACTORS

Difficulty in the Installation of Tokenization Solutions to Decrease Market Growth

Implementation of tokenization solution is a highly complicated process and requires professional help. Tokenization is a process which involves creation of tokens and then storing the value of credit and debit card pins in these tokens or token vaults.

When information is continuously fed into these token vaults the storage space decreases, resulting in several complexities. Cyber attackers always focus on online channels to launch their attacks. Trained and skilled work-force is a necessity when it comes to operating tokenization services. The lack of trained workforce can emerge as a major problem. All of these factors can hamper the market growth.

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TOKENIZATION SOLUTION MARKET REGIONAL INSIGHTS

North America to Dominate Market Share in The Upcoming Years

North America holds the largest market share in tokenization solution market. This can be attributed to the increase in the cashless transactions in various organizations. With increasing adoption of online banking, the risks of frauds and cyber-attacks have also increased.

Development in the technological sector is also fueling the market growth. Cloud-based tokenization is a very popular form of tokenization service in this region due to its convenience. Rising number of debit and credit card users is also increasing the scope of market in North America.

KEY INDUSTRY PLAYERS

Leading Players adopt Acquisition Strategies to Stay Competitive

Several players in the market are using acquisition strategies to build their business portfolio and strengthen their market position. In addition, partnerships and collaborations are among the common strategies adopted by companies. Key market players are making R&D investments to bring advanced technologies and solutions to the market.

List of Top Tokenization Solution Companies

• Hewlett Packard Enterprise (U.S.)
• Cardconnect Corporation (U.S.)
• Tokenex, LLC (U.S.)
• Cybersource Corporation (U.S.)
• Protegrity USA, Inc. (U.S.)
• Paymetric, Inc. (U.S.)
• 3delta Systems, Inc. (U.S.)
• Thales Group (France)
• Broadcom Inc. (U.S.)
• First Data Corporation (U.S.)
• Ciphercloud Incorporation (U.S.)
• Fiserv, Inc. (U.S.)
• Liaison Technologies Inc (U.K.)

REPORT COVERAGE

The report provides an insight into the industry from both the demand and supply sides. Further, it also gives information on the impact of COVID-19 on the market, the driving and the restraining factors along with the regional insights. Market dynamic forces during the forecast period have also been discussed for the better understanding of the market situations