FIDO Authentication Market Size, Share, and Industry Analysis By Application (Payment Processing, PKI/Credential Management, Document Signing, User Authentication, and Others), By Industry (BFSI, Healthcare & Life Sciences, IT & Telecom, Retail & CPG, Government & Defense, Energy & Utilities, and Others), and Regional Forecast, 2025-2032

The global FIDO authentication market is expanding owing to increasing security concerns with a surge in cyberattacks. FIDO authentication utilizes public-key cryptography to validate a user's identity, making it a robust authentication method. Compared to traditional password-based authentication, it offers increased security and user convenience. Implementing FIDO authentication can replace passwords for logging in to various websites and applications, ultimately enhancing security by preventing unauthorized access attempts. With the rise in cyberattacks, there is a growing demand for more secure authentication methods and FIDO offers resistance to phishing and other attacks.

• In 2023, there were over 7 billion online accounts with passkey sign-in options and 52% of consumers and employees were familiar with passkeys.

The COVID-19 pandemic has acted as a catalyst for the FIDO authentication market, highlighting the need for secure, user-friendly authentication solutions. The resulting increase in cybersecurity threats and the shift toward digital services present substantial opportunities for growth and innovation in this sector.

Impact of Generative AI on the FIDO Authentication Market

Integration of Generative AI for Enhancing FIDO Authentication Applications to Boost Market Growth

Generative AI tools such as deep fakes are posing new challenges for identity verification and authentication. By creating realistic synthetic audio, images, and videos, bad actors can spoof identities to bypass security controls. This is especially concerning for remote identity proofing methods that rely on biometrics such as face and voice recognition.

Moreover, while generative AI is making identity spoofing easier, FIDO authentication leverages a combination of on-device biometrics, cryptography, and layered verification to provide strong protection against these AI-enabled attacks. By eliminating the transmission of sensitive credentials, FIDO makes it extremely difficult for hackers to leverage AI to bypass authentication.

FIDO Authentication Market Driver

Increasing Cyber Threats to Drive the Market Growth

The rise in cyberattacks, particularly targeting financial institutions and sensitive data, has heightened the demand for robust authentication methods. FIDO authentication offers a strong defense against phishing and other attacks, making it an attractive solution for organizations looking to enhance their security posture.

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• According to Check Point, the frequency of cyber-attacks is on the rise globally, seeing a 30% surge in weekly assaults on corporate networks in Q2 2024 when compared to Q2 2023, as well as a 25% increase from Q1 2024. Organizations are experiencing an average of 1,636 attacks per week, highlighting the increasing complexity and determination of threat actors. Multiple cyber threat trends are concurrently occurring.

FIDO Authentication Market Restraint

Lack of Interoperability between Different FIDO Authentication Solutions May Hinder Market Growth 

The lack of interoperability between various FIDO authentication solutions is a significant market restraint. While there are numerous FIDO authentication solutions to choose from, they do not consistently collaborate. This can pose challenges for businesses and government agencies aiming to integrate FIDO authentication across their entire organizations.

FIDO Authentication Market Opportunity

Integration of Biometrics and IoT to Create Lucrative Opportunities in the Market

The rising adoption of biometric technologies and the Internet of Things (IoT) can enhance FIDO authentication systems. Integrating these technologies can lead to more secure and user-friendly authentication methods, appealing to a broader range of industries.

• In October 2023, Thales, a global technology and security provider, introduced a security key that allows robust multi-factor authentication (MFA) for businesses called SafeNet IDPrime FIDO Bio Smart Card. This innovative contactless smart card enables users to securely and swiftly access applications, cloud services, and enterprise devices using a fingerprint rather than a password.
• As per the 2023 Verizon Data Breach Investigations Report, attackers primarily infiltrate an organization through stolen credentials, phishing, and exploiting vulnerabilities. 49% of all breaches involve stolen credentials. In light of these threats, many organizations transitioning to the cloud are struggling with limited user acceptance of MFA, often due to its perceived inconvenience.

Segmentation

Key Insights

The report covers the following key insights:

• Micro Macro Economic Indicators
• Drivers, Restraints, Trends, and Opportunities
• Business Strategies Adopted by the Key Players
• Impact of Generative AI on the Global FIDO Authentication Market
• Consolidated SWOT Analysis of Key Players

Analysis by Application

Based on application, the market is divided into payment processing, pki/credential management, document signing, user authentication, and others.

FIDO authentication is revolutionizing payment processing by providing a secure, user-friendly, and compliant method for online transactions. Its ability to enhance security while improving user experience positions it as a critical component in the future of digital payments, making it an attractive option for merchants and financial institutions.

Analysis by Industry

Based on industry, the market is subdivided into BFSI, healthcare & life sciences, it & telecom, retail & CPG, government & defense, energy & utilities, and others.

In 2023, the BFSI segment dominated the market, boasting a substantial share. FIDO authentication is transforming the BFSI industry by providing a secure, user-friendly, and compliant alternative to traditional password-based authentication. Its ability to enhance security while improving the customer experience positions it as a critical component in the future of digital banking and financial services.

Regional Analysis

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Based on region, the market has been studied across North America, Europe, Asia Pacific, South America, and the Middle East & Africa.

In 2023, North America is anticipated to be the primary market for FIDO authentication due to the widespread adoption of new technologies and growing security apprehensions. The region's emphasis on biometric authentication and acknowledgment of security risks is a significant driving force. Furthermore, some governments are enforcing the use of FIDO Authentication for critical applications, thereby bolstering the market.

The Asia Pacific market is expected to witness rapid growth, attributed to the swift expansion of the digital economy and escalating security concerns. The surge in cyber-attacks is also increasing the demand for FIDO authentication as it protects various attack vectors.

Europe is recognized for its advanced technology expertise and stringent data privacy regulations. Various industries in countries such as Germany, the U.K., France, and the Nordic countries are witnessing significant adoption of FIDO Authentication solutions. The European Union has concentrated on enhancing data protection and privacy rights through initiatives such as the GDPR, which has contributed to the market growth.

Key Players Covered

The global market is fragmented with the presence of a large number of group and standalone providers.

The report includes the profiles of the following key players:

• Google (U.S.)
• Microsoft Corporation (U.S.)
• Amazon Web Services (U.S.)
• Yubico (U.S.)
• OneSpan Inc. (U.S.)
• HID Global Corporation (Ireland)
• Thales Group (France)
• Intercede (U.K.)
• NEC Corporation (Japan)
• Ant Financial Services Group (China)
• Neurotech (Brazil)
• Token One (Argentina)
• EOH Holdings (South Africa)
• Touché (UAE)
• Digital Factors (UAE)

Key Industry Developments

• In October 2023, Intercede revealed its plans to introduce a solution for managed enterprise FIDO Authentication at Authenticate 2023 in California. Intercede’s enterprise multi-factor authentication (MFA) software, along with Yubico's YubiKey hardware authentication security key, will enable the replacement of Windows Hello, passwords, and PKI for Business with highly phishing-resistant and secure FIDO authentication.
• In April 2023, Yubico announced YubiKey 5C NFC. This new security key is compatible with U2F and FIDO2 authentication protocols.