Global Know Your Customer Software Market Size, Share & Industry Trends Analysis Report By Component, By Deployment (Cloud and On-premise), By Enterprise Size, By End-use (BFSI, Telecom, Government, and Others), By Regional Outlook and Forecast, 2022 - 2028
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Get in-depth analysis of the COVID-19 impact on the Know Your Customer Software Market
Market Report Description
The Global Know Your Customer Software Market size is expected to reach $9.5 billion by 2028, rising at a market growth of 19.7% CAGR during the forecast period.
A Know Your Customer software is a program that assists in implementing KYC. Know Your Customer or KYC refers to the procedure through which a company verifies the identification of its clients. Organizations like banks, financial institutions, and other institutions and workplaces employ KYC as a method of authentication. A KYC process includes a few characteristics in order to be considered standard. Policy on customer acceptance, techniques for customer identification, management of risk, and monitoring unusual activity in consumer transactions are some of the most important functions that KYC software performs.
Any business relationship with a financial institution, bank, and company handling sensitive information, international vendor, customer, or supplier is required to go through the KYC procedure. In addition, it is crucial for organizations to conduct KYC during the contract signing and onboarding and on an ongoing basis. This is needed in order to prevent affiliation with business partners who are engaged in non-compliance with regulations and rules and financial crimes.
KYC is a part of customer due diligence (CDD) and it engages in confirming customers' identities. In order to detect ownership connections, collusion in anti-money laundering (AML), and connections between organizations, KYC procedures are implemented to evaluate personal and company records. The process identifies any negative hits, such as watch lists, sanctions lists, and politically exposed persons (PEPs) lists associated with the person. Minimum criteria for CDD, risk, and compliance assessments have been created to help combat money laundering, financial crime, terrorist financing, and other illicit activities.
KYC is an essential part of the compliance management system (CMS). The system defines the extent of compliance checks and regulatory risk needed to be considered depending on the anticipated level of risk. Additionally, transactions are reviewed for any potential odd activity. The determination of the source and location of funds is consequently a primary goal of Know-Your-Business-Partner due diligence.
COVID-19 Impact Analysis
A significant trend of the pandemic was the desire for flexible workforces, which intensified even after the outbreak subdued. Businesses outsourced contingent workers on a project-by-project basis to save operating expenses. The number of compensation claims, loan approvals, mortgage holiday requests, and other state claims and rules that must be vetted, processed, and distributed by individuals in compliance increased. As a result, for many companies’ completion of KYC became a critical provision.
Market Growth Factors
Streamlining and quickening of the KYC process
Most of the know your customer software significantly helps in countering the high abandonment rates that are usually seen in the manual know your customer systems. The time-consuming process of carrying document copies for the KYC process to go through successfully renders customers to abandon the process, and some may not even consider it. The rising adoption of KYC software has eventually increased the range of KYCs being done in many companies and institutions. KYC software enables businesses to deduct the time requirements of a single KYC from days to minutes.
Easy configuration of rules to comply with CDD/EDD
The automated onboarding of KYC through the software assists in verifying individuals and their documents remotely. This can be done either through visual identity verification software or by searching international databases. This simplifies the inclusion of checking against sanctions registers and PEPs, in addition to enabling the due diligence of directors or beneficial owners for harmful political and media exposure. Consequently, this establishes compliance with governmental bodies for EDD/CDD and AML and allows quick production of audit trails.
Market Restraining Factor
Lack of consistency in the required type of document
The failure of digital infrastructure and the high probability of data breaches pose a significant danger to the implementation of KYC. In addition, the increasing instances of personal information misuse deter many customers from opting for KYC. Furthermore, the nonexistence of document standardization among the various banks, fintech, and financial institutions raises the complexity of the KYC process to some extent. It has been found on many occasions that different companies from the same industry demand different sets of documents for KYC. This is especially true in cases where a company operates in many jurisdictions.
Based on component, the know your customer software market is categorized into software and services. The services segment procured a considerable growth rate in the know your customer software market in 2021. One of the main drivers of the segment's growth is the capacity of KYC software services to assist financial institutions and banks in enhancing operational effectiveness.
Based on deployment, the know your customer software market is classified into on-premise and cloud. The on-premise segment witnessed a considerable growth rate in the know your customer software market in 2021. Financial organizations can more readily validate consumer data on-site with the use of on-premise technologies. One important aspect influencing the category is the on-premise KYC software's capacity to validate and store customer data on the premises of the firms.
Enterprise Size Outlook
On the basis of enterprise size, the know your customer software market is fragmented into large enterprises and small & medium enterprises. The small and medium enterprises (SME) segment garnered a remarkable growth rate in the know your customer software market in 2021. To give customers a better experience, small and medium-sized businesses are increasingly digitizing their services. Companies from all over the world are establishing a KYC design team to aid small and medium-sized banks in streamlining their KYC procedure.
Based on end-use, the know your customer software market is segmented into BFSI, telecom, government, and others. The BFSI segment procured the highest revenue share in the know your customer software market in 2021. Increased online payment activity through various financial institutions and banks throughout the world is responsible for segment growth. To increase their market share, banks and other financial institutions are using a wide range of cutting-edge technology, including cloud computing and artificial intelligence.
|Market size value in 2021||USD 2.7 Billion|
|Market size forecast in 2028||USD 9.5 Billion|
|Historical Period||2018 to 2020|
|Forecast Period||2022 to 2028|
|Revenue Growth Rate||CAGR of 19.7% from 2022 to 2028|
|Number of Pages||231|
|Number of Tables||423|
|Report coverage||Market Trends, Revenue Estimation and Forecast, Segmentation Analysis, Regional and Country Breakdown, Competitive Landscape, Companies Strategic Developments, Company Profiling|
|Segments covered||Component, Deployment, Enterprise Size, End-use, Region|
|Country scope||US, Canada, Mexico, Germany, UK, France, Russia, Spain, Italy, China, Japan, India, South Korea, Singapore, Malaysia, Brazil, Argentina, UAE, Saudi Arabia, South Africa, Nigeria|
On the basis of region, the know your customer software market is analyzed across North America, Europe, Asia Pacific, and LAMEA. The North America segment recorded the highest revenue share in the know your customer software market in 2021. Major market participants' presence is a key element in promoting regional growth. Banks, retailers, and other financial organizations should see an increase in demand for new solutions due to the expanding preference for digitization.
Free Valuable Insights: Global Know Your Customer Software Market size to reach USD 9.5 Billion by 2028
KBV Cardinal Matrix - Know Your Customer Software Market Competition Analysis
The major strategies followed by the market participants are Product Launches. Based on the Analysis presented in the Cardinal matrix; Experian PLC and RELX PLC (LexisNexis Risk Solutions, Inc.) are the forerunners in the Know Your Customer Software Market. Companies such as Fenergo, Trulioo, Inc. and Acuant, Inc. are some of the key innovators in Know Your Customer Software Market.
The market research report covers the analysis of key stake holders of the market. Key companies profiled in the report include Pegasystems, Inc., Experian PLC, RELX PLC (LexisNexis Risk Solutions, Inc.), Fenergo, Truth Technologies, Inc., Equiniti Group plc (Siris Capital Group LLC), ACTICO GmbH, Trulioo, Inc. and Acuant, Inc.
Recent Strategies Deployed in Know Your Customer Software Market
- Oct-2022: Fenergo introduced Fenergo Smart Review, a new perpetual KYC Solution. This solution aims to smoothen the periodic review process and automates the regular monitoring of client profiles for KYC Compliance through recognizing the changes for transactions, entity data, and AML Screening.
- Sep-2022: Trulioo expanded its operations to Singapore and expanded its presence in Asia Pacific Region. Through starting operations in Singapore, the company expanded its offerings of compliance solutions for enhanced customer onboarding throughout the global markets.
- Aug-2022: Experian signed a partnership agreement with DQ Global, a provider of data quality solutions. The partnership focuses on tackling the rising financial crime in the UK. FCA-regulated customers can access a wide view of business through the integration of DQ Global’s suite of no-code FinTech products with Experian’s KYC (Know Your Customer) data.
- Jun-2022: Fenergo unveiled Fen-Xcelerate, a SaaS Client Lifecycle Management Solution for Mid-Sized & Boutique Financial Institutions. This solution provides end-to-end, fast, digital account opening and customer journeys in 6-12 weeks on a single platform. The solution supports integration with transaction monitoring services, its core banking systems, and a customer-facing portal, among others.
- Apr-2022: Fenergo took over Sentinels, an AML (anti-money laundering) transaction monitoring company. The acquisition bolstered the due diligence process of the former company's clients through enhancing monitoring with rich KYC profiles and client behavioral data. Additionally, this acquisition helped Fenergo in delivering end-to-end Software as a Service (SaaS) based-CLM with smart transaction monitoring to financial firms.
- Feb-2022: Trulioo completed the acquisition of HelloFlow, the innovative no-code, drag-and-drop builder of client onboarding, monitoring, and digital workflow solutions. Jointly, the companies are focused on optimizing the onboarding workflows to make the user experience smooth, while fulfilling the Anti-Money Laundering, Know Your Customer, and other regulatory and fraud prevention requirements.
- Jan-2022: Trulioo made enhancements in GlobalGateway, its platform that has innovations in upgraded Know Your Business verification capabilities and Anti-Money Laundering (AML) watchlist and proof of address offerings. The upgrade includes UtilityID, GlobalGateway Watchlist, and upgraded Business Verification. These services, together, smoothen the onboarding of businesses and consumers. Additionally, it provides continuous monitoring for money laundering, fraud, and illicit behavior across the customer lifecycle.
- Nov-2021: Experian launched Work Report, a digital verification service for payroll data-sharing consent. This service enables the customers to consent to share their payroll information digitally with other enterprises. Work Report allows a customer in confirming their identity and consent for sharing the verified income, credit information, and expenditure in a single data exchange.
- Aug-2021: LexisNexis announced the acquisition of TruNarrative, a provider of automated onboarding, dynamic risk scores, and transaction monitoring. The acquisition assists the company in its fraud and financial crime compliance solutions.
- May-2021: Acuant took over Hello Soda, an innovative and global provider of identity verification, KYC, and AML solutions. The acquisition reinforced Acuant's identity platform and global rank in digital identity. The combination aims to bring powerful technology and data science capabilities, the major key to unlocking trust in digital identities.
- Nov-2020: Acuant announced the launch of Acuant Go No Code IDV and KYC Solutions for Agile Digital Transformation. Acuant Go delivers the fastest Go-to-market option with secure and proven technology. It is a portfolio of no-code solutions and is the fastest way to go-to-market and implement mobile and web identity verification and KYC/AML that meet regulatory, business, and customer needs.
- Jul-2020: Trulioo released document verification and facial recognition feature to its EmbedID solution. These features deliver the same level of online protection to small and medium-sized businesses.
- Apr-2020: Fenergo signed an original equipment manufacturing agreement with IBM, a technology company. Together, the companies aimed to develop solutions that integrate IBM's RegTech portfolio of anti-money laundering (AML) and know-your-client (KYC) solutions, all built with Watson with Fenergo’s CLM offering.
- Apr-2020: ACTICO came into partnership with Avaloq, a provider of digital banking solutions. The partnership aims to deliver automated and innovative compliance solutions for financial service providers and banks, based on machine learning.
Scope of the Study
Market Segments Covered in the Report:
By Enterprise Size
- Large Enterprises
- Small & Medium Enterprises
- North America
- Rest of North America
- Rest of Europe
- Asia Pacific
- South Korea
- Rest of Asia Pacific
- Saudi Arabia
- South Africa
- Rest of LAMEA
Key Market Players
List of Companies Profiled in the Report:
- Pegasystems, Inc.
- Experian PLC
- RELX PLC (LexisNexis Risk Solutions, Inc.)
- Truth Technologies, Inc.
- Equiniti Group plc (Siris Capital Group LLC)
- ACTICO GmbH
- Trulioo, Inc
- Acuant, Inc.
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What would be the size of the Know Your Customer Software Market by 2028?
The global Know Your Customer Software Market size is expected to reach $9.5 billion by 2028.
What are the key driving factors and challenges in the Know Your Customer Software Market?
Streamlining and quickening of the KYC process are driving the market in coming years, however, Lack of consistency in the required type of document restraints the growth of the market.
What are the major top companies in the competitive landscape?
Pegasystems, Inc., Experian PLC, RELX PLC (LexisNexis Risk Solutions, Inc.), Fenergo, Truth Technologies, Inc., Equiniti Group plc (Siris Capital Group LLC), ACTICO GmbH, Trulioo, Inc. and Acuant, Inc.
Which segment shows a high revenue share of the Know Your Customer Software Market in 2021?
The Large Enterprises market is generating high revenue in the Global Know Your Customer Software Market by Enterprise Size in 2021; thereby, achieving a market value of $5.7 billion by 2028.
Which segment is leading the market in 2021?
The Software market is leading the segment in the Global Know Your Customer Software Market by Component in 2021; thereby, achieving a market value of $7.4 billion by 2028.
Which region dominated the Know Your Customer Software Market in 2021?
The North America market dominated the Global Know Your Customer Software Market by Region in 2021; thereby, achieving a market value of $3.2 billion by 2028.