Hardware OTP Token Authentication Market Size

Hardware OTP Token Authentication Market Analysis

The Hardware OTP Token Authentication Market is expected to register a CAGR of 7.5% during the forecast period. Hardware OTP tokens are a product category in the two-factor authentication field, primarily used for access control applications and securing user authentication. Primary authentication is followed by secondary authentication using a hardware device. Because user logon authentication is not permitted without ownership of the hardware device, hardware tokens ensure reliable and authenticated user logon.

• The portability factor associated with these hardware devices further eliminates the need for external software and hardware for identity management. The enhanced level of security provided by these tokens is a significant factor reinforcing their demand across the various end-user industries worldwide.
• Enterprises, BFSI, government, healthcare, and other segments (gaming, service providers, etc.) are a few of the end-user industry segments requiring multi-factor authentication for granting access to information or usage of services. The mandatory regulations from many government bodies make it necessary to use OTP.
• Software OTP, SMS, email, biometrics, etc., substitute hardware OTP tokens. Still, hardware tokens are considered more secure as they do not require a network to access the passcode or PIN and are not susceptible to hacks, among other threats.
• Hardware multi-factor authentication (MFA) typically comes in the form of smart cards, USB security keys, and OTP generators. Many organizations have leveraged hardware-based security for the most high-risk users and events. Still, the rollout was often entirely focused due to cost, complexity, impact, and likelihood calculations performed during risk management.
• The online resources offered by financial services organizations are their primary competitive advantage in a highly crowded market, motivating businesses to provide more online features and functions to outperform the competition. The market's expansion will be aided by these organizations' search for safe authentication solutions like OTP token authentication.
• The COVID-19 pandemic impacted multiple global markets. The banking, financial services & insurance, government, enterprise security, and healthcare industries have suffered drastically, though in very different ways. Moreover, the pandemic has changed the perception of the global supply chain in manufacturing, where more localized value chains and regionalization have come into the picture. These are primarily done to minimize similar future risks posed by the pandemic. However, post-COVID-19, the demand for the market remained constant, and vendors have been introducing new services.