Meticulous Research®—a leading global market research company, published a research report titled, ‘Tokenization Market by Offering (Solutions, Services), Application (Payment Security, User Authentication, Compliance Management), Vertical (BFSI, Retail, Travel, Healthcare, Others), Organization Size, and Geography - Global Forecasts to 2029’.
According to this latest publication from Meticulous Research®, the global tokenization market is projected to grow at a CAGR of 17.3% from 2022–2029, to reach $14.3 billion by 2029. The significant rise in the adoption of digital payment modes, the necessity to adhere to stringent PCI DSS guidelines, and the rise in fraudulent activities across global e-commerce sectors are the major factors driving the growth of this market. Furthermore, the increasing use of payment applications across different industry verticals is expected to offer significant growth opportunities for the growth of this market. However, the lack of trust in online transactions restrains the growth of this market up to a certain extent.
The global tokenization market is segmented by offering, application, industry vertical, and organization size. The study also evaluates industry competitors and analyses the market at the country and regional levels.
Based on offering, in 2022, the solution segment is expected to account for the largest share of the global tokenization market. The segment is also projected to grow at the highest CAGR during the forecast period. The increasing demand for advanced payment security solutions for digital e-commerce and the increasing use of payment applications across different industry verticals is driving the growth of this segment. In addition, payment security solutions have gained popularity as it enables organizations to adhere to the PCI DSS regulatory compliances. Moreover, the growing number of data breaches and financial losses associated with it are the primary factors contributing to the growth of the tokenization solutions market.
Based on application, in 2022, the payment security segment is expected to account for the largest share of the global tokenization market. The growth of this segment is attributed to factors such as the increasing need to stay compliant with payment security guidelines and the growing need to ensure continuous customer experience and maintain fraud prevention levels due to increased financial crimes.
However, the user authentication segment is projected to grow at the highest CAGR during the forecasted period. The growth of this segment is attributed to the rising security breaches and sophisticated cyberattacks leading to financial and reputational loss, stringent government regulations to increase the adoption of authentication solutions, and the rising instances of identity theft and fraud.
Based on industry vertical, in 2022, the BFSI segment is expected to account for the largest share of the global tokenization market. The growth of this segment is attributed to the rising implementation of regulatory security compliance, rising demand for cloud-based security solutions, and the increasing risk of cyber threats against BFSI infrastructure.
However, the retail segment is projected to grow at the highest CAGR during the forecasted period. Retail e-commerce sales are rapidly increasing due to government support, increased smartphone penetration, and application usage. The increasing usage of mobile payments in the retail industry, primarily in the e-commerce sector, boosts the tokenization market. Therefore, the adoption of tokenization solutions is expected to increase in the retail sector.
Based on organization size, in 2022, the large enterprise segment is expected to account for the largest share of the global tokenization market. The segment is also projected to grow at the highest CAGR during the forecast period. Increasing transactions of high valuations in large enterprises are compelling them to opt for premium tokenization solutions.
Additionally, the integration of digital payment solutions with the existing payment landscape is essential for large enterprises. Business owners may not be cyber security experts and do not have the time to stay updated on the latest protections needed to safeguard their payment data. Current rules, regulations, and certain state laws place additional responsibility for protecting cardholder data on businesses. Failure to meet industry, card brand, and regulatory data security standards can result in potential penalties, additional fees, loss of income, and negative brand perception. Thus, the rising concern for creating a safe environment for customer payment transactions is expected to drive the adoption of tokenization among large enterprises.
Based on geography, in 2022, North America is expected to account for the largest share of the global tokenization market. The factors contributing to the market's growth include the growing use of smartphones, increased internet speed and reliability, the growing user base of tech-savvy millennials, and the latest innovations in the payments landscape. However, Asia-Pacific is projected to grow at the highest CAGR during the forecast period. The growth in this region is primarily driven by the increasing adoption of advanced payment technologies within organizations to perform business transactions.
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The key players operating in the global tokenization market are Bluefin Payment Systems LLC (U.S.), Braintree (U.S.), Cybersource (U.S.), Elavon (U.S.), Ingenico (France), Broadcom, Inc. (U.S.), Thales Group (France), Shift4 Payments, LLC (U.S.), Signifyd (U.S.), TNS, Inc. (U.S.), Tokenex (U.S.), SISA Information Security Pvt. Ltd. (India), Stripe (U.S.), Geobridge Corporation (U.S.), MasterCard (U.S.), Verifone Systems Inc. (U.S.), Fiserv, Inc. (U.S.), Micro Focus (U.K.) and American Express (U.S.).
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