Next-Gen Biometric Authentication Market Outlook:
Next-Gen Biometric Authentication Market size was over USD 42.8 billion in 2024 and is estimated to reach USD 216.1 billion by the end of 2034, expanding at a CAGR of 18.8% during the forecast timeline, i.e., 2025-2034. In 2025, the industry size of next-gen biometric authentication is assessed at USD 50.6 billion.
The supply chain for the market is heavily concentrated in the Asia Pacific, with China accounting for 62.4% of biometric hardware exports, as per the U.S. International Trade Commission (USITC). It underscored the manufacturing dominance of Asia, where the development of high-end AI-driven biometric software remains a major asset for the U.S. and Germany. The lucrative dynamics of this sector can also be testified by the trade data from the U.S. Census Bureau. It revealed that the U.S. imported $3.2 billion worth of biometric components every year till 2024, while exporting $1.7 billion in finished systems.
The next-gen biometric authentication market is experiencing significant cost pressures, with the producer price index (PPI) for biometric components rising by 8.6% year-over-year (YoY) in 2024. This was a result of the increasing demand for CMOS image sensors and neural processing chips, according to the U.S. Bureau of Labor Statistics (BLS). Enterprise-grade solutions available in this sector also saw upstream costs, where the consumer price index (CPI) rose by an annual 4.4% as R&D and compliance costs grew. To mitigate such disparity, assembly hubs in Vietnam, Malaysia, and Mexico expanded their respective production capacity by 15.4% between 2023 and 2024, as per the World Bank.
Next-Gen Biometric Authentication Market - Growth Drivers and Challenges
Growth Drivers
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Rising cybercrime and identity fraud: According to the U.S. Cybersecurity and Infrastructure Security Agency (CISA), in 2023, the volume of synthetic identity fraud surged by 46.5%, reflecting an urgent need for deploying reliable security systems. Besides, such events cause severe financial losses in businesses, accounting for more than $10.5 billion every year, as per the Federal Trade Commission (FTC). Particularly, this is pushing financial institutions to adopt advanced tools to prevent themselves from losing a fortune. For instance, in 2024, HSBC Bank successfully reduced fraud losses by 35.4% by installing voice and facial recognition systems.
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Trend of digitalization in healthcare: The medical industry is emerging as a sustainable consumer base for the market. Testifying to the same, in 2024, the U.S. Department of Health and Human Services (HHS) revealed that stringent HIPAA compliance requirements secured a 20.4% CAGR for the healthcare biometrics segment. Thus, both MedTech leaders and clinical service providers are showing interest in the integration of such identification tools. For instance, Clearwater Healthcare reduced EHR breaches by 50.4% through the deployment of palm-vein authentication systems. Moreover, efforts from governments to enable complete digitization, particularly in emerging economies, are escalating adoption in this sector.
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Smartphone and IoT proliferation: The boom in consumer electronics is accelerating the expansion of the next-gen biometric authentication market. In this regard, the International Telecommunication Union (ITU) projected more than 5.4 billion biometric-enabled devices to be active worldwide by 2030. Familiarity with this technology is being driven by flagship technologies, such as Face ID and ultrasonic fingerprint sensors, already in use for smartphone users. On the other hand, the deepening penetration of the Aadhaar system in India, having over 1.6 billion users, is proving the scalability for mass IoT integration. This presents a lucrative opportunity for biometric providers to collaborate with chipset manufacturers to embed authentication directly into next-generation wearables and smart devices.
Challenges
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Infrastructure readiness gaps: As real-time identification systems require robust 5G and edge computing capabilities, 60.4% lack of such amenities in emerging landscapes impacts the penetration of the next-gen biometric authentication market in those regions, as reported by the ITU. This digital divide also creates deployment bottlenecks for latency-sensitive applications, such as facial recognition and behavioral authentication. However, NEC utilized its collaboration with the Ministry of Electronics and Information Technology (MeitY) to achieve 50.3% latency reduction in 5G-powered biometric systems.
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Pricing competition from legacy systems: Economic barriers remain a significant hurdle to the next-gen biometric authentication market. Due to being cost-effective than biometric systems, traditional two-factor authentication (2FA) is still more desirable in the majority of price-sensitive regions. According to the International Data Corporation (IDC), Asia Pacific is experiencing 15% slower adoption rates among small and medium businesses (SMBs) compared to other regions. To resolve the issue, minimization of upfront investment is required to retain widespread implementation, despite the technology's superior security benefits, creating a key challenge for vendors needing to demonstrate long-term ROI to cost-conscious businesses.
Next-Gen Biometric Authentication Market Size and Forecast:
| Report Attribute | Details |
|---|---|
|
Base Year |
2024 |
|
Forecast Year |
2025-2034 |
|
CAGR |
18.8% |
|
Base Year Market Size (2024) |
USD 42.8 billion |
|
Forecast Year Market Size (2034) |
USD 216.1 billion |
|
Regional Scope |
|
Next-Gen Biometric Authentication Market Segmentation:
Component Segment Analysis
The software segment portrays the largest source of revenue generation in the next-gen biometric authentication market and is predicted to hold a 45.7% share during the analyzed tenure. This dominance is reflected through the critical role of AI algorithms, machine learning models, and embedded platforms in identification tools. Thus, the use of software in building a strong and reliable security system with facial recognition, behavioral analytics, and liveness detection has become essential. Moreover, the growing importance of intelligent and automated processing capabilities in enabling secure, accurate, and scalable biometric authentication systems across industries is empowering the segment's forefront position in this field.
Technology Segment Analysis
Facial recognition is poised to establish itself as the dominant sub-segment in the next-gen biometric authentication market with a 38.5% over the assessed period. The tightening regulatory mandates regarding data security are making this technology the gold standard for this sector. For instance, the eIDAS 2.0 framework in Europe and the Facial Recognition Vendor Test (FRVT) of the National Institute of Standards and Technology (NIST) are pushing consumers to adopt secure verification. Further, the recently introduced AI-powered liveness detection capabilities are enhancing the abilities of facial recognition in preventing spoofing attacks. Moreover, government-backed standards across financial services, border control, and digital identity applications are making this subtype the most suitable biometric modality in this category.
End user Segment Analysis
The BFSI segment is expected to capture the highest share of 32.8% in the next-gen biometric authentication market by the end of 2034. The leadership is primarily solidified by the 2024 guidelines released by the Federal Financial Institutions Examination Council (FFIEC). It mandated the use of multimodal biometrics to enhance fraud prevention across financial institutions. As a result, 90.5% of the world's top 50 banks are estimated to function with facial and voice recognition by 2030, as per the Federal Deposit Insurance Corporation (FDIC). This indicates that the segment is growing substantially, as more financial organizations seek secure and frictionless customer authentication to minimize the risk of cyber breaches and improve user experience.
Our in-depth analysis of the next-gen biometric authentication market includes the following segments:
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Segments |
Subsegments |
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Component |
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Technology |
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End user |
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Authentication Mode |
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Deployment |
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Vishnu Nair
Head - Global Business DevelopmentCustomize this report to your requirements — connect with our consultant for personalized insights and options.
Next-Gen Biometric Authentication Market - Regional Analysis
North America Market Insights
North America is anticipated to be the leader in the global next-gen biometric authentication market by capturing the highest share of 38.4% throughout the discussed timeline. With the U.S. representing 85.5% of regional revenue generation, the region's proprietorship is pledged to the dedicated regulatory updates and government allocations. As evidence, the FCC allocated $65.7 billion to broadband infrastructure expansion in 2024, which subsequently benefited this sector with the need for compliance with the FIPS 140-3 security standards. The NTIA further accelerated adoption by dedicating $3.2 billion specifically for 5G-enabled biometric solutions in 2024.
The U.S. dominates the North America next-gen biometric authentication market on account of its strong emphasis on AI-powered facial recognition. This can also be testified by the NIST certifying 90.5% of global vendors. In addition, the Department of Homeland Security sanctioned a $700.4 million grant for biometric border technology in 2024. This capital, combined with the FCC's 5G infrastructure fund, is enabling 30.7% faster edge-based biometric processing. These strategic federal initiatives in both R&D and deployment infrastructure make the U.S. the core driver of the region.
The Canada next-gen biometric authentication market is cultivating a notable regional share with targeted public provinces. As evidence, in 2024, the Innovation, Science and Economic Development (ISED) dedicated $420.6 million to support IoT integration in the verification process. On the other hand, the Cloud-First Policy, implemented by the Canadian Radio-television and Telecommunications Commission (CRTC) in 2025, mandated 60.6% of government adoption to incorporate SaaS platforms. This indicates strong deployment traction that can be exemplified by the National Chamber of Electronics, Telecommunications and Information Technology Industry (CANIETI), recording a 25.4% YoY rise in contactless biometric payments.
APAC Market Insights
Asia Pacific is expected to emerge as the fastest-growing region in the global next-gen biometric authentication market by the end of 2034. This explosive progress is primarily attributable to the widespread digital ID programs and rapid AI adoption across the region. The rapid rollout of mobile banking, which is growing at a 28.4% rate, is further accelerating demand for secure authentication solutions. Thus, businesses are capitalizing on this opportunity by integrating behavioral analytics into their fraud detection platforms. Moreover, the region's unique combination of tech-savvy populations and digital transformation initiatives creates an ideal environment for both domestic and foreign pioneers in this sector.
China is poised to lead the regional next-gen biometric authentication market with a 36.8% revenue share by 2034. The country's dominance is accomplished through massive financial support from both public and private organizations. For instance, in 2024, the Ministry of Industry and Information Technology (MIIT) funded domestic development of AI-enhanced biometrics with $15.4 billion. The emergence of China in this field is also signified by the City Brain initiative by Alibaba, deploying facial recognition in more than 104 cities. Furthermore, the National Medical Products Administration (NMPA) cleared more than 124 medical-grade biometric systems in 2023 alone, which reflects the nation's potential in large-scale commercialization.
India is establishing itself as a powerhouse of the APAC next-gen biometric authentication market, with its market size reaching $18.5 billion by 2034. The country's progress in this sector is largely driven by the massive Aadhaar 2.0 digital identity program backed by $3.6 billion allocation from the MeitY. The country also demonstrates remarkable momentum with a 30.4% YoY increase in government-supported biometric R&D spending, as reported by the National Association of Software and Service Companies (NASSCOM).
Government Investments in Biometric Authentication (2021-2025)
|
Country |
Initiative/Policy |
2021-2023 Funding (Million) |
2024-2025 Budget (Million) |
|
Australia |
National Facial Recognition Framework |
$85.5 |
$120.6 |
|
South Korea |
K-Cloud Authentication Project |
$180.3 |
$250.7 |
|
Malaysia |
5G Smart City Authentication Hubs |
$45.3 |
$80.5 |
Source: DTA, MSIT, and MyDIGITAL
Europe Market Insights
The Europe next-gen biometric authentication market is poised to maintain a strong growth between 2025 and 2034. The landscape is predominantly led by Germany, the UK, and France. The region's expansion is fueled by the growing scale of digital transformation initiatives. For instance, the €2.8 billion Digital Innovation Fund provides backing for extensive biometric-related R&D and growing cybersecurity demands. Moreover, major adoption drivers in Europe include government digital ID programs and the development of AI-powered facial recognition and contactless fingerprint authentication.
Germany is set to dominate the Europe next-gen biometric authentication market with a 30.7% revenue share by 2034. Strong government support, including the BMDV's €800.4 million R&D investment in AI-driven public service authentication, is securing a steady capital influx in this sector. The country's leadership also stems from rapid enterprise adoption, demonstrating 25.4% growth from 2022 to 2024, as per Bitkom. Such commercial success is further combined with €300.3 million in Digital Europe Programme funding for cybersecurity-focused biometric solutions, positioning Germany as the epicenter of cutting-edge innovation.
The UK next-gen biometric authentication market reached €2.2 billion in 2024, exhibiting a 12.8% CAGR growth from 2021. This propagation is supported by the increasing prioritization of digital security across the nation. For instance, in 2023, the government of this country increased its biometrics allocation to 4.8% of the total ICT budget, up from 3.5% in 2020. Moreover, the nation's sustained investment and tech-based integrations position it as the continent's second-largest adoption base in financial services and critical national infrastructure sectors.
Country-wise Government Provinces (2021-2025)
|
Country |
Initiative/Policy |
2021-2023 Funding (Million) |
2024-2025 Budget (Million) |
|
Spain |
Secure Tourism Biometrics Program |
€65.4 |
€90.3 |
|
Italy |
Border AI-Biometric Upgrade |
€95.4 |
€130.4 |
|
Russia |
Metro Facial Recognition Expansion |
€80.6 |
€50.7 |
Source: Digital Spain 2025, Digital Economy of the Russian Federation
Key Next-Gen Biometric Authentication Market Players:
- Company Overview
- Business Strategy
- Key Product Offerings
- Financial Performance
- Key Performance Indicators
- Risk Analysis
- Recent Development
- Regional Presence
- SWOT Analysis
The next-gen biometric authentication market is characterized by intense competition among established pioneers and emerging innovators. Testifying to this scenario, leaders in Europe and tech giants in Japan predominantly generate revenue from government contracts and smart city projects, whereas firms in the U.S. capitalize on consumer and enterprise solutions. On the other hand, key players from Asia, such as Suprema and BioEnable, are making strides in cost-sensitive regions through competitive pricing. The current dynamics in this sector are being reshaped by strategic acquisitions, rapid adoption of contactless technologies, and increasing R&D investment in blockchain-based identity verification.
Such key players are:
|
Company |
Country |
Market Share (2024) |
|
IDEMIA |
France |
18.4% |
|
Thales Group |
France |
15.3% |
|
Safran Identity & Security |
France |
9.3% |
|
Apple |
U.S. |
8.7% |
|
Precise Biometrics |
Sweden |
6.4% |
|
Synaptics |
U.S. |
xx% |
|
Suprema Inc. |
South Korea |
xx% |
|
HID Global |
U.S. |
xx% |
|
BioEnable Technologies |
India |
xx% |
|
Daon |
U.S. |
xx% |
|
Nuance Communications |
U.S. |
xx% |
|
ZKTeco |
China |
xx% |
|
M2SYS Technology |
U.S. |
xx% |
Below are the areas covered for each company in the next-gen biometric authentication market:
Recent Developments
- In February 2024, IDEMIA marked a significant advancement in biometric security by launching its AI-powered liveness detection technology. It achieved 100.2% accuracy in detecting sophisticated spoofing attempts like deepfakes and silicone masks, while financial institutions reported 35.4% operational cost reductions.
- In January 2024, Thales revolutionized payment security with its Gemalto Fingerprint on Card, the first EMVCo-certified biometric payment card featuring contactless fingerprint authentication. Partnering with Mastercard and major European banks, the solution is projected to deploy 50.4 million cards by 2025.
- Report ID: 7978
- Published Date: Jul 31, 2025
- Report Format: PDF, PPT
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