Behavioral Biometrics Market Size, Share & Trends Analysis Report By Component, By Type, By Application, By Deployment, By Enterprise Size, By End-use, By Region, And Segment Forecasts, 2023 - 2030

Behavioral Biometrics Market Size & Trends

The global behavioral biometrics market size was valued at USD 1.45 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR of 27.3% over the forecast period from 2023 to 2030.The rise in online transactions and increased fraudulent activities are driving the demand for digital authentication across the globe. Furthermore, the growing demand for a multi-layered security approach in financial institutions is expected to drive market growth. The development of the Internet of Things (IoT) landscape and the growing need for enhanced security systems are also expected to propel market growth.

The rising usage of smartphones for entertainment, socializing, and work purposes is increasing the number of mobile applications to provide these services. The consecutive increase in the use of mobile applications and the exchange of data over the web are giving rise to numerous security and privacy concerns. However, traditional authentication techniques such as unlock patterns and passwords could be more effective regarding advanced security and privacy threats. The trend drives the popularity of advanced techniques such as continuous authentication based on behavioral biometrics.

The notable rise in online services, such as webmail, e-Banks, and e-commerce, which verify users by a username and password, is being increasingly exploited by identity thieves. An additional security layer proves to be significantly beneficial in overcoming potential identity theft. Verifying users based on their mouse activities and keystroke dynamics provides a greater potential as an additional biometric security layer. These factors are expected to drive the market over the forecast period.

The emerging technologies such as Machine Learning (ML) and Artificial Intelligence (AI) and the growing adoption of these technologies in applications such as authentication and identification provide a potential growth opportunity for market players. Developers increasingly use AI, machine learning, and behavioral biometrics to develop authentication, identification, and verification products for enhanced security. AI-driven behavioral biometrics are mainly used for account takeover fraud prevention across financial institutions. Developments in AI are facilitating significant enhancements in the capabilities of AI-driven behavioral biometrics, the growing adoption of which is expected to improve authentication and identification approaches.

However, data privacy is a major concern surrounding new technologies, including behavioral biometrics. The collection and storage of personal information using these technologies, such as face recognition, voice recognition, and signature, may invade privacy by some. Furthermore, voice recognition in behavioral biometrics requires high-quality recording, and verifying users with background noise is difficult. These factors are likely to hamper market growth over the forecast period.

The pandemic compelled several companies operating in the market to halt manufacturing operations to comply with new government regulations temporarily. Revenue streams have been directly affected due to the adverse impact caused by supply chains and trade disruptions on overall operations. However, the pandemic has increased the demand for secure, hygienic, and convenient authentication systems across the globe. The highly contagious nature of COVID-19 has made people wary of touching card readers, keypads, and other devices used for accurate identity authentication. It has increased the demand for behavior-based technologies such as voice recognition and gait analysis, which offer accurate solutions to identify people in-person and online and do not contribute to spreading COVID-19 and other pathogens.

Behavioral biometrics technology offers increased security and reliability owing to using more than one means of identification. Furthermore, cloud-based applications enable the storage of massive amounts of behavioral biometric data, which can help meet the needs of government agencies and organizations.

Favorable government initiatives across the globe fuel the market for behavioral biometrics. The increasing use of behavioral biometrics in industries such as BFSI, IT & telecom, and retail & e-commerce has contributed immensely to market growth. Multimodal biometrics-based products are gaining popularity, especially in e-IDs and airport verification systems. Integrating behavioral biometrics with consumer electronics has made the technology accessible to the public.

Increasing demand for smooth customer experiences, free of stumbling blocks or complications, is anticipated to drive the market over the forecast period. Furthermore, the current procedures in cybersecurity and design for customer experience are prime areas where the market incumbents are investing. Behavioral biometric verification methods are being increasingly utilized to cover the gap by adding a secure data-driven authentication layer that enables a better user experience.

Technological advancements have increased the influx of behavioral biometrics systems that can scan a range of personal traits. Constant innovations and the easy availability of unique solutions have increased technology penetration in different sectors. Global networks, the growing adoption of smartphones, and the increasing penetration of the Internet of Things (IoT) have produced unprecedented amounts of data that humans could not analyze or understand. The use of artificial intelligence, which enables computers to analyze and make use of this data, has exploded as a result. Furthermore, machine learning, a subfield of artificial intelligence, has played a key role in the continued growth of the market for behavioral biometrics.

Component Insights

Based on the component, the market is segmented into software and service. The software component type held the largest market share of 69.7% in 2022. The growing demand for reliable and safe digital transactions globally, owing to the growing penetration of smartphones and the e-commerce industry, is leading to the increased adoption of behavioral biometrics software. Additionally, the rising number of fraudulent activities coming to light is driving the demand for behavioral biometrics software.

To reduce fraud, increase security, and minimize the costs associated with traditional multi-factor authentication solutions and passwords, vendors in the market are developing behavior-based authentication software. For instance, in March 2019, Veridium Ltd., a provider of identity and access management software, launched InMotion for VeridiumID, the company’s software-only platform for mobile security. The platform uses behavioral biometrics to enhance mobile security for individuals and businesses. The software uses User Behavior Analytics (UBA) to identify patterns in human behavior and detects anomalies, which could indicate security breaches, using statistical analytics. The introduction of such innovative software based on behavioral biometrics is further expected to drive the growth of the software segment over the forecast period.

The service segment is projected to register the fastest CAGR of 28.1% over the forecast period. There is a growing awareness among organizations about the importance of behavioral biometrics in enhancing security and fraud prevention. As more companies recognize the limitations of traditional authentication methods, they are turning to behavioral biometrics to provide an additional layer of security. This increased awareness drives the demand for services for implementing and managing behavioral biometric systems.

Application Insights

The identity proofing segment dominated the market with the highest revenue share of 33.7% in 2022. Identity-proofing solutions provide different authentication options to users based on their privilege levels. These solutions also help establish policies for authenticating sensitive applications by developing fail-safe mechanisms. The application market is segmented into identity proofing, continuous authentication, risk and compliance management, and fraud detection and prevention.

Growing awareness among organizations about the need to maintain the confidentiality of their data and counter the increasingly frequent and sophisticated cyberattacks, malware, identity-related fraud, and data breaches targeted at their data is further expected to drive the segment's growth. The growing popularity of automation and digitization across end-use industries such as BFSI, IT & telecom, healthcare, and government increases demand for robust security solutions. Additionally, stringent government regulations across the globe regarding identity-proofing for improving security and safety are further expected to drive demand for identity-proofing solutions.

The risk & compliance management segment is expected to witness the fastest CAGR of 28.3% over the forecast period. The need for robust risk and compliance solutions has grown with the increasing adoption of online transactions, digital banking, and e-commerce. Behavioral biometrics provide an effective means to secure these digital interactions and protect against evolving threats. As more businesses and individuals engage in online activities, the demand for behavioral biometrics in risk and compliance management continues to rise.

Deployment Insights

The on-premise segment dominated the market with the highest revenue share of 64.1% in 2022. On-premise behavioral biometrics solutions are easy to integrate and configure with existing online offerings. Furthermore, the on-premise implementation provides organizations with a high degree of customization and incurs lower costs in case of additional resources. Based on deployment, the market has been segmented into on-premise and cloud.

The cloud segment is expected to witness the fastest CAGR of 27.9% over the forecast period. Cloud deployment allows business applications to be easily integrated with third-party applications and provides security to online offerings. Organizations are now increasingly adopting cloud applications to streamline their data storage. Furthermore, owing to the increasing demand, several vendors in the market have focused on offering cloud-based behavioral biometrics solutions.

Enterprise Size Insights

The large enterprise segment dominated the market with the highest revenue share of 72.5% in 2022. Large enterprises focus on implementing behavioral biometrics in their business applications to improve customer loyalty and reduce overall infrastructure costs. This trend will drive demand for behavioral biometrics in the large enterprise segment. Increasingly sophisticated data theft and cyberattacks drive the adoption of behavioral biometrics-based cybersecurity measures, which provide adaptive authentication and persistent security in large enterprises. Furthermore, behavioral biometrics tools allow large enterprises to meet increasingly stringent cybersecurity regulations and standards such as ISO 27001, NIST 800-171, and the Health Insurance Portability and Accountability Act (HIPAA).

Growing technological advances and technology-driven business models increase customer expectations for a high-end security experience to protect personal data and provide an improved security experience. Enterprises are adopting a combination of two or more biometrics modalities, such as behavioral biometrics, voice biometrics, facial recognition, and fingerprint scanning, to offer secure services to their customers. Furthermore, end-use industries such as BFSI, healthcare, IT, and telecom collaborate with biometrics tool providers to secure personal and customer data from growing online fraud.

The small & medium enterprise segment is expected to witness the fastest CAGR of 28.1% over the forecast period. SMEs often need more financial resources than larger enterprises to invest in expensive security solutions. Behavioral biometrics offers a cost-effective alternative to traditional biometric authentication methods that require specialized hardware or infrastructure. SMEs can implement behavioral biometrics without high additional costs by leveraging existing devices and software, such as smartphones or web browsers.

End Use Insights

Based on end-use, the market is segmented into BFSI, retail and e-commerce, healthcare, government and defense, IT and telecom, and others. The BFSI segment dominated the market with the highest revenue share of 25.7% in 2022. BFSI sector organizations use behavioral biometrics to develop next-generation identification solutions to combat fraudulent activities and make transactions more secure. A continuous rise in government initiatives and financial regulations globally is compelling companies in the BFSI sector to opt for behavioral biometrics solutions to secure customer data and offer enhanced customer experience.

The growing trend of open banking systems across the globe, which forces banks to open up their digital infrastructure to third parties through APIs, can lead to an increase in instances of fraudulent activities. Furthermore, growing digitization across financial institutions to improve customer experience increases the demand for measures to safeguard the network infrastructure from data breaches. The improved safety offered by behavioral biometrics solutions leads to increased demand across financial institutions. The emergence of mobile and online banking globally and the rising demand to improve e-Banking security are expected to drive demand for behavioral biometrics in the BFSI segment.

The healthcare segment is expected to witness the fastest CAGR of 28.6% over the forecast period. Healthcare organizations are subject to stringent data protection and privacy regulations, such as the Health Insurance Portability and Accountability Act (HIPAA) in the United States. Behavioral biometrics can assist healthcare providers in meeting compliance requirements by providing an extra layer of security for patient data access and ensuring that only authorized personnel can access sensitive information.

Type Insights

Based on the type, the market is segmented into keystroke dynamics, gait analysis, signature analysis, and voice recognition. The voice recognition segment dominated the market with the highest revenue share of 37.6% in 2022. The demand for voice assistants such as Google Home, Alexa, Siri, and Cortana is growing, and consumers will likely be interested in using voice biometrics to unlock their devices. Voice recognition also helps identify fraudsters within the voice channel by involving a one-to-one match between voice samples. These factors are expected to propel the growth of the voice recognition segment.

Voice recognition does not require additional dedicated hardware apart from a microphone, increasing its demand across end-use industries. Furthermore, the increasing adoption of voice recognition across banks to automate the login process, which helps enhance customer satisfaction levels and minimize bank customer care costs through automation, is likely to work well for the segment. Voice biometrics also saves time across several end-use industries, eliminating paperwork and lengthy verification processes. Moreover, the advent of technologies such as artificial intelligence, machine learning, data analytics, and cloud computing and the growing demand for safe financial and healthcare data are expected to provide significant opportunities for companies operating in voice recognition.

On the other hand, the keystroke dynamics segment is expected to grow at the fastest CAGR of 28.1% over the forecast period. Keystroke dynamics provide a unique and reliable method of user authentication and fraud detection. Each individual has a distinct typing rhythm and pattern, which can be captured and analyzed by keystroke dynamics technology. By comparing a user's typing behavior against their established profile, organizations can authenticate users accurately and detect suspicious activities or unauthorized access attempts.

Regional Insights

North America dominated the market with the largest revenue share of 33.6% in 2022. The growing demand for data security through behavioral biometrics solutions and the presence of leading technology providers is anticipated to drive market growth in North America. Furthermore, the region's end-use industries, such as BFSI, government, IT, and telecom, significantly focus on adopting behavioral biometrics to secure their offerings and customer data. Governments in the region are also taking a keen interest in behavioral biometric applications and are aggressively funding and organizing various research programs to develop advanced behavioral biometrics applications. For instance, in July 2023, the U.S. made progress in implementing a privacy framework for exchanging data with the European Union (EU). The framework involves the development of mechanisms and protocols that prioritize data security and compliance with privacy regulations. By reaching a comprehensive agreement, both parties aim to facilitate transatlantic data exchanges while respecting privacy rights and upholding data protection standards.

Companies operating in the behavioral biometrics market must comply with technical standards established by government institutions and private organizations. Several standards and regulations govern several aspects of a business operating in the market, including the manufacturing process, and mandate that all products adhere to them. For instance, manufacturers and sellers of behavioral biometrics in the European market must comply with the EU General Data Protection Regulation (GDPR) to ensure the security and privacy of data using cloud platforms.

The Asia Pacific is expected to grow at the fastest CAGR of 29.3% during the forecast period. The rising proliferation of mobile and real-time payment platforms across the region has increased fraud events, driving the demand for behavioral biometrics. Furthermore, financial service providers in the region focus on providing their customers with secure authentication solutions based on behavioral biometrics. For instance, in August 2019, Mastercard, a financial services provider, launched a behavioral biometrics-based mobile authentication solution in India to increase the security of e-commerce transactions.

Key Companies & Market Share Insights

To strengthen their positions in the market, key players are adopting strategies such as new product launches, collaborations, mergers and acquisitions, and product upgrades. For instance, in November 2019, Fair Isaac Corporation (FICO) acquired security access provider EZMCOM Inc. The acquisition facilitated the former to launch digital onboarding technology, FICO identity proofing, and FICO user identification using multi-factor behavioral authentication capabilities. The key market players also heavily invest in R&D activities to strengthen their capabilities across new and emerging technologies and incorporate them into their products.

Recent Developments

• In February 2023, BioCatch, a provider of behavioral biometric intelligence and advanced fraud prevention technology, established its Australian headquarters. This strategic move reinforces the company's strong position in the global market. It marks its expansion into the Asia-Pacific region with the opening of offices in both Australia and Singapore.

• In February 2023, BioCatch, an innovator in behavioral biometric intelligence and a player in fraud detection, has recently received the prestigious recognition of being named a "Company to Watch in 2023" by Liminal. Liminal is a respected strategy advisory firm catering to digital identity, cybersecurity, fintech solution providers, and private equity and venture capital stakeholders. This accolade further underscores BioCatch's exceptional standing in the industry and its potential for significant achievements in the coming year.

• In June 2023, BioCatch, a player in fraud detection, announced plans for the worldwide expansion of its behavioral biometric intelligence solutions. This expansion is made possible through a collaboration with Microsoft and the inclusion of BioCatch's offerings in Microsoft's Cloud for Financial Services (FSI Cloud). By integrating BioCatch's solutions, financial institutions can strengthen their security measures, effectively identify and thwart fraudulent activities, and provide customers with an environment that instills greater trust and security.

• In May 2022, LexisNexis Risk Solutions, a division of RELX, completed the acquisition of BehavioSec, a leading provider of advanced behavioral biometrics technology. As part of the acquisition, BehavioSec's solutions will be integrated into LexisNexis Risk Solutions' Business Services group, strengthening its existing portfolio focused on device and digital identity. This acquisition will complement the offerings of LexisNexis ThreatMetrix, further enhancing their capabilities in the field.

• In December 2022, ValidSoft, a voice biometrics provider based in the UK, launched a new voice authentication solution designed to provide trusted identity assurance for enterprise remote access applications such as Zero Trust Network Access (ZTNA), Privileged Access Management (PAM), and Identity and Access Management (IAM). By leveraging digit-based voice authentication, ValidSoft's solution offers enhanced security measures to verify and authenticate users, ensuring a higher level of trust in their identities during remote access scenarios within enterprise environments.

Behavioral Biometrics Market Report Scope

Global Behavioral Biometrics Market Report Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global behavioral biometrics marketbased on component, type, application, deployment, enterprise type, end use, and region:

• Component Outlook (Revenue in USD Million, 2017 - 2030)

  • Software

  • Service

    • Managed Services

    • Professional Services

• Type Outlook (Revenue in USD Million, 2017 - 2030)

  • Keystroke Dynamics

  • Gait Analysis

  • Signature Analysis

  • Voice Recognition

• Application Outlook (Revenue in USD Million, 2017 - 2030)

  • Identity Proofing

  • Continuous Authentication

  • Risk & Compliance Management

  • Fraud Detection & Prevention

• Deployment Outlook (Revenue in USD Million, 2017 - 2030)

  • On-premise

  • Cloud

• Enterprise Size Outlook (Revenue in USD Million, 2017 - 2030)

  • Large Enterprise

  • Small & Medium Enterprise

• End Use Outlook (Revenue in USD Million, 2017 - 2030)

  • BFSI

  • Retail & E-commerce

  • Healthcare

  • Government & Defense

  • IT & Telecom

  • Others

• Regional Outlook (Revenue in USD Million, 2017 - 2030)

  • North America

  • U.S.

  • Canada

  • Europe

  • UK

  • Germany

  • France

  • Asia Pacific

  • Japan

  • China

  • India

  • Australia

  • South Korea

  • Latin America

  • Brazil

  • Mexico

  • Middle East & Africa

  • South Africa

  • Saudi Arabia

  • UAE