Identity Theft Protection Services Market Size, Share & COVID-19 Impact Analysis, By Type (Credit Card Fraud, Bank Fraud, Phone or Utility Fraud, and Employment or Tax-related Fraud), By Application (Consumer and Enterprise), and By Regional Forecast, 2023-2030

The global identity theft protection services market size was valued at USD 11.56 billion in 2022 and is projected to grow from USD 13.13 billion in 2023 to USD 33.35 billion by 2030, exhibiting a CAGR of 14.2% during the forecast period.

The surge in communication networks and digitalization of businesses have increased the risk of cyberattacks and exposed organizations to a wide range of new risks. According to the U.S. government, identity theft is the fastest-growing financial crime, affecting about 15 million Americans each year. As per a survey conducted by Security.org, around 67% of U.S. adults stated that they had their identities stolen in 2019-2020. The number of identity theft victims increased to over 20.7 million in 2020. Further, according to the Identity Theft Research Center (ITRC) report, there was a record of 1,862 data compromises in the U.S. in 2021. This figure was a 68% increase from that in 2020 and around 23% more than the previous all-time high of 1,506.

Identity theft occurs when personal information, such as addresses, social security numbers, date of birth, telephone numbers, bank account numbers, credit cards, and passwords, is used by hackers to conduct any fraudulent activity, such as opening fake accounts, applying for loans, making large purchases, and draining users’ bank accounts. Therefore, consumers and enterprises are increasing their spending on identity theft protection services to protect their employees and confidential data from cyber attackers, achieve business growth, meet recruiting goals, and boost employee retention.

COVID-19 IMPACT

Rollout of New Programs & Practices amid COVID-19 Accelerated Demand for Identity Theft Protection Services

The relocation of on-site staff to distant home offices during the COVID-19 pandemic led to more cyberattacks. With an uptick in COVID-19-related frauds targeting employees, clients, and consumers, an increase in the online sharing of personal and business information through home networks and personal & work devices made hacking easier to breach data.

As per the Federal Trade Commission (FTC), the pandemic caused a notable surge in scams related to identity theft. It stated that on 29^th March 2021, it received 3,038 COVID-related identity theft reports, which was the highest in a single day.

Fraudsters misuse the opportunity to leverage Personally Identifiable Information (PII), financial information, and medical records of those looking for treatment, knowledge, and protection from the viral infection. Besides, the drastic surge in shopping online to avoid exposure to COVID-19 increased the demand for credit card fraud protection services. As per a TransUnion fraud survey, one in ten adults in the U.S. experienced identity theft since the start of the pandemic in 2020.

Rolling out of new programs and rapid changes in the extension of due dates for paying taxes in response to COVID-19 have encouraged fraudsters to steal information for misuse. The Federal Bureau of Investigation (FBI) had warned of numerous scams related to the coronavirus. However, the identity theft insurance industry experienced a decline in their services in 2020 as compared to 2019 as consumer spending declined, resulting in less demand for such products and services.

LATEST TRENDS

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Rising Number of Identity Thefts in Government and Public Sectors to Bolster Service Demand

In recent years, cyberattacks on non-profit organizations, government agencies, and institutions within the public sector have risen considerably. As government departments have started depending on electronic data and computer networks to conduct their daily operations, large pools of personal and financial information are being transferred and stored online. Government records can be exploited in several ways – tax fraud being one of the most popular forms of identity theft in recent times. For instance,

• In 2021, over 2.8 million fraud cases were recorded by the FTC (Federal Trade Commission) in the U.S., of which identity theft took the top spot, accounting for 25% of the total cases.

As federal and state governments support millions of consumers impacted by COVID-19, it has become easier for fraudsters to gain access to funds and accounts meant to help individuals in need. As cybercrime poses an increasing and permanent threat, government organizations and public sector companies using cyberspace are continuously struggling to ensure adequate security for their assets and data. These factors are likely to generate tremendous growth opportunities for the market.

DRIVING FACTORS

Rising Online Financial Transactions to Necessitate Deployment of Identity Theft Protection Services

The number of online transactions has been experiencing rapid growth over the past few years, driven by factors, such as high convenience and speed. Internet-based transactions have not only empowered banks to scale up and widen their offerings and value-based services but also enabled them to improve their customers’ experiences. However, fraudsters are utilizing technology-based transactions to target confidential data. For instance:

• As per the FTC reports, in 2021, consumers lost USD 5.8 billion to fraud, which was more than 70% as compared to 2020.


• The worst data breaches in 2019 were the Adobe Creative Cloud breach in October, which exposed around 7 million users, and the July Capital One Financial Corp breach, which exposed over 100 million records.

A rise in malicious cyberattacks related to online transactions is expected to necessitate the deployment of these services, which track the data of invaders, monitor users’ personal data while offering comprehensive protection by masking important details. Thus, rising concerns associated with data breach and identity theft are likely to propel the identity theft protection services market growth in the coming years.

RESTRAINING FACTORS

High Costs Associated with Identity Theft Protection Services Might Impede Market Growth

Identity theft protection services can be expensive depending on how well users want their assets to be protected. The plans for these services range from about USD 10 to USD 30 per month, depending on the chosen services. For example, identity theft insurance services might cover only a few services related to insurance and might not take legal expenses and time spent away from work services into consideration. Adding extra services also increases the price of the plan. Thus, the SMEs that are less susceptible to fraud avoid purchasing identity theft protection services and opt for free services instead.

SEGMENTATION

By Type Analysis

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Rising Number of Credit Card Users to Drive Market Growth

Based on type, the market has been categorized into credit card fraud, bank fraud, phone or utility fraud, and employment or tax-related fraud.

Among these, the credit card fraud segment accounts for the largest identity theft protection services market share as the demand for credit card-related protection services is increasing with the rising credit card users. However, the bank fraud segment is expected to showcase the highest growth rate during the forecast period owing to the increasing preference for online banking transactions as they offer high speed and convenience. Besides, fraudsters have been preying on utility consumers by taking advantage of rising electricity and phone bills, thereby stealing financial and personal information. The employment and tax-related fraud segment is expected to showcase significant growth due to the rising number of tax frauds and increasing incidence of identity thefts associated with rewards & loyalty programs and retirement accounts.

By Application Analysis

Consumer to Lead Market Growth Owing to Their Increasing Online Presence

Based on application, the market has been bifurcated into consumers and enterprises.

The consumer segment is leading the market growth as the number of consumers opening online shopping accounts, social media accounts, and online banking accounts are rising at a strong rate. However, the enterprise segment is expected to show the highest CAGR during the forecast period owing to the growing number of data breaches, frauds, and thefts in various industries.

REGIONAL INSIGHTS

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By region, the market has been analyzed across five major regions, namely North America, Europe, South America, the Middle East & Africa, and Asia Pacific.

North America dominates the global market share as the region’s e-commerce sector is flourishing at a notable rate and users are opening new online accounts for the same. The U.S. government has recently taken steps to curb identity theft, such as the BuySecure initiative, a dedicated task force for identity theft in the country.

Asia Pacific is expected to showcase the highest CAGR during the forecast period led by the rising credit card users along with increasing online payments.

Europe holds the second position in the market in terms of market share due to the growing fraudulent activities, which stemmed from stealing personal mail, rising malicious software activities, and a surge in cyberattacks, tricking people, and acquiring confidential information.

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Furthermore, the Middle East, Africa, and South America regions are expected to grow significantly due to increasing internet penetration and rising internet-based financial transactions.

KEY INDUSTRY PLAYERS

Companies Adopt Strategic Alliance and Partnership Strategies to Fuel Competition

The identity theft protection services industry is growing rapidly due to increasing competition, technological innovations, and merger & acquisition activities among local and regional vendors that offer specific application services for varied end-users. Many public and private companies are forming alliances with other small and medium enterprises to strengthen their market presence.

May 2021 – Discover Financial Services introduced an identity theft protection service for all consumers in the U.S. and was made available to its credit card members. This extended service aimed to enable existing and new customers to view the company as a full-service digital bank.

November 2020 – Sontiq, an Intelligent Identity Security provider, partnered with Breach Clarity, a Fintech solutions provider, to offer solutions that would empower individuals in their fight against identity vulnerabilities and data breaches by providing personalized breach risk intelligence.

List of the Key Companies Profiled:

• Equifax, Inc. (U.S.)


• NortonLifeLock Inc. (U.S.)


• TransUnion LLC (U.S.)


• Experian Information Solutions, Inc. (U.S.)


• Malwarebytes Ltd (U.S.)


• LexisNexis Risk Solutions (U.S.)


• AllClearID (U.S.)


• Kroll (U.S.)


• Fair Isaac Corporation (U.S.)


• McAfee, LLC (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• February 2023 – Bitdefender, a provider of cybersecurity solutions, launched a novel cybersecurity solution named Bitdefender Premium Security Plus. This solution provides various industry users with threat detection and prevention techniques by offering 24/7 digital identity protection & monitoring and a secure Virtual Private Network (VPN) for online privacy.


• January 2023 – McAfee Corp., a provider of online protection solutions, launched a new McAfee+ Family plan. This plan protects the privacy, identity, and devices of families in a single plan. It is available in the U.S. and provides online protection to up to six family members.


• November 2022 – McAfee engaged in a partnership with MasterCard, a technology company in the payment industry. Through this partnership, McAfee aimed to provide online protection solutions for MasterCard personal and small & medium-sized business card holders.


• May 2022 – Bitdefender launched ‘Bitdefender Identity Theft Protection’, a new consumer service for its U.S. customers. This solution monitored credit and financial accounts 24/7 and offered identity threat detection and alerts in real time.


• February 2021 – Sontiq, an Intelligent Identity Security provider, acquired CyberScout, an identity theft resolution provider, to further expand into the insurance industry with forensic investigation and cyber protection solutions.

REPORT COVERAGE

An Infographic Representation of Identity Theft Protection Services Market

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The market research report highlights leading regions across the world to offer users a better understanding of the market. Furthermore, the report provides valuable insights into the latest industry trends and analyzes technologies that are being deployed at a rapid pace at the global level. It further offers some of the drivers and restraints, helping the reader gain in-depth knowledge about the market.

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