The tokenization market was valued at USD 1.2 billion in 2019 at a CAGR of 22.4% during the forecast period of 2020-2025. Tokenization Solution market is now gaining traction in various end-user industries and has caught the eye of various organizations for better data security. Some of the prominent trends that the market is witnessing include, increasing adoption among payments gateways, and growing government regulations regarding usage of personal information are some main reasons owing to the tokenization solution market.
- There has been a continuous growing demand for secure payment gateways. Due to the increased adoption rate of payment gateways, the customers are switching to more secure payment gateway options due to the currency involved in the process.
- With an increased amount of data that is getting generated, the governments of several countries are engaging in decelopment of data privacy and development laws in order to safegaurd the citizens from any loss in data.
Scope of the Report
Tokenization is the process of replacing sensitive data with unique identification symbols that retain all the essential information about the data without compromising its security. Tokenization, which seeks to minimize the amount of data a business needs to keep on hand, has become a popular way for small and mid-sized businesses to bolster the security of credit card and e-commerce transactions while minimizing the cost and complexity of compliance with industry standards and government regulations.
Key Market Trends
The Growing Demand for Secure Payment Gateways has Boosted the Market Substantially.
- The growing data breaching cases have created the demand for secure payments gateway, which is a major factor driving the demand for tokenization solution. According to the Identity Theft Resource Center (ITRC), the data breaching cases in 2017 in the US increased by 44.7% as compared to 2016. The number of data breaches in the Medical and Healthcare sector, in 2018, was reported to be 367.
- Nearly 20% of breaches included credit and debit card information, an almost 6% increase from last year. Approximately 37% of all credit card fraud in the U.S. is related to counterfeit cards. These growing data breach cases are also increasing the financial losses due to it. Hence, thriving the demand for tokenization solution.
- As the need for payment security will be increased due to the growing e-commerce sector and increasing digitization in the healthcare industry, the market for tokenization solution is estimated to grow significantly for the forecast period.
North America is Expected to Hold Significant Market Share
- North America is the dominating region in tokenization solution market, owing to the earliest adoption of advanced technology in the payment gateway industry. Most of the tokenization solution vendors are American based, hence accounting the major portion of the revenue of tokenization solution market.
- The adoption of cloud technology is highest in the region, a vital reason for growing adoption of tokenization solution. The region is also the home of all the major e-commerce major companies, where the adoption of tokenization solution is highest.
- The significant growth of retail and e-commerce industry in the region is further estimated to grow tokenization solution market. BFSI sector has also shown healthy growth in the region. The highest adoption of blockchain technology in the region is estimated to further expand the tokenization solution market significantly.
The tokenization solution market consists of several major players. In terms of market share, none of the players currently dominate the market. The companies are involving themselves in improving their expertise in the field and security in order to gain a competitive advantage.
- May 2018: Symantec Corporation, the world’s leading cybersecurity company, announced the opening of a new privacy research center, based in Saarbrucken, Germany. The new location’s effort is two-fold, to give consumers greater control over their personal data and their online footprints, and provide governments and corporations additional tools to help them be responsible custodians of data they handle.
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