Need to curb fraudulent activities in BFSI sector is a key growth driver of the market

New York, NY -- (SBWire) -- 04/24/2019 --The increasing need to curb fraudulent activities, growing adoption of biometrics, and rising efforts to go paperless are pushing the demand for digital signatures. Generating a revenue of $826.7 million in 2017 according to a P&S Intelligence study, the digital signature market is expected to grow at a CAGR of 26.5% during the forecast period 2018–2023. Digital signature refers to any electronic data used as a signature to authenticate the sender of a message.

When segmented by component, the domain can be divided into services, hardware, and software. Among these, the services division led the market in 2017 with over 44.0% revenue contribution to the digital signature market. The services available to implementers include creation, processing, and validation of secure and interoperable electronic signatures. While services will still be the dominating division during the forecast period, the demand for software is expected to grow the fastest.

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The surge in demand for software is predicted to be fueled by their customizability as per the specific need of the end user and the fact that digital signature help in reducing paperwork. This further substantiates the finding that of all the end users of digital signatures, including IT, government, banking, financial services and insurance (BFSI), healthcare & life sciences, retail telecom, and others, the government sector already contributed the highest revenue to the digital signature market in 2017.

Governments across the world are storing citizen data in the electronic format rather than on paper to make the implementation of public schemes smoother, and reduce operational costs and the negative environmental impact from the cutting of trees. Examples of such government initiatives would be the Aadhaar scheme of India and the Gov.UK portal of the U.K. Similarly, the Uniform Electronic Transactions Act (UETA) 1999 and the U.S. Electronic Signatures in Global and National Commerce Act (ESIGN) 2000 encourage the use of digital signatures and mandate that these are deemed valid, legal, and enforceable.

Apart from government efforts to reduce paper use and save trees, the increasing number of frauds and the need to keep a tab on these are another factor pushing the digital signature market growth. For instance, in the healthcare sector, after authenticating the identity of healthcare professionals via their digital signature, prescriptions can be electronically transferred to the hospital server and then further to the pharmacy. As pharmacists have a copy of the doctors' signature, the technology aids them in detecting forgery.
This is the very reason that digital signature-based biometrics are being increasingly deployed in the BFSI sector. As authentication of a person's identity is of utmost importance in the sector due to the money factor, digital signatures are used to detect fraudulent transactions, as a digital signature cannot be copied. Therefore, the increasing risk of money-related frauds and the need to detect and prevent these are driving the growth of the digital signature market, especially in developed countries, such as Germany and the U.S.

Thus, it is clear that digital signatures not only help in reducing paperwork, but are also instrumental in protecting people's assets and even life.