Digital identity revenues on course to double

Research shows that revenues will exceed $53 billion globally in 2026, doubling from $26 billion in 2021

Posted 9 February 2022 by Christine Horton

Revenue for digital identity vendors is set to double between 2021 and 2026. New figures shows that revenues will exceed $53 billion globally in 2026, doubling from $26 billion in 2021.

The forecast is from a new study from Juniper Research, Digital Identity: Key Opportunities, Regulatory Landscape & Market Forecasts 2022-2026, which examines the potential revenue from third-party and civic identity apps, centralised identity schemes, and digital identity verification.

In addition, the research predicts that the increased demand for digital onboarding frameworks in the face of the ongoing pandemic will accelerate the uptake of digital identity services.

The research notes that verified digital identity – where identities are confirmed as genuine using verifiable credentials – is being vital for improving fraud mitigation. This represents the next evolutionary step for digital identity, moving from establishing infrastructure to utilising and verifying identity in practical applications. To facilitate this, the report predicts increasing data partnerships between vendors to provide comprehensive, data diverse identity systems.

Verification now the key requirement

The research finds that verification spend will exceed $16 billion in 2026, from $9 billion in 2021. This growth reflects that, as users migrate to digital channels, the need to verify identity digitally also grows. As fraudsters exploit opportunities, verification capabilities will proliferate to wider industries and use cases than ever before.

“Digital identity verification tools have become more critical across a broader range of industries than ever, from banking and financial services to eGovernment, healthcare and others,” said Research co-author Damla Sat. “Developing effective user experiences for different verification scenarios will be important for realising digital identity’s potential.”

The US falling behind in digital identity

The research found that the US is significantly lagging behind in digital identity terms. It accounts for only seven percent of global digital identity revenue in 2026. The US’ lack of national identity schemes and coordinated strategies appear to be a major limiting factor. The report, however, recognised the potential for decentralised identity in the US, and recommends vendors focus on private initiatives to realise identity’s potential in the market.