According to a new report, published by KBV research, The Global Out-of-band (OOB) Authentication Market size is expected to reach USD 4.59 billion by 2032, rising at a market growth of 15.8% CAGR during the forecast period.
The evolution of OOB authentication has been shaped by the escalating complexity of cyber threats and the growing limitations of traditional single-factor authentication methods. With the staggering increase in digital transactions and online services globally, simple passwords have proven inadequate in protecting sensitive information from modern cyberattacks. Recognizing this, industry standards bodies and government agencies have broadly recommended multi-factor authentication (MFA) practices that supplement passwords with additional proof of identity.
The Software segment is leading the Global Out-of-band (OOB) Authentication Market by Components in 2024; thereby, achieving a market value of $3.06 billion by 2032. The software segment forms the foundation of the out-of-band (OOB) authentication market, enabling secure identity verification across digital platforms. OOB authentication software supports functionalities such as one-time password generation, multi-factor authentication workflows, user verification, and integration with enterprise systems. Organizations deploy these solutions to protect online transactions, cloud applications, and remote access environments.
The Cloud segment would register maximum revenue share the Global Out-of-band (OOB) Authentication Market by Deployment in 2024, growing at a CAGR of 15.9 % during the forecast period. Cloud-based out-of-band (OOB) authentication is widely adopted as organizations increasingly migrate applications and services to cloud environments. This deployment model enables scalable, flexible, and centrally managed authentication across distributed user bases. Cloud OOB authentication supports rapid implementation, real-time updates, and seamless integration with digital platforms such as banking, e-commerce, and enterprise applications.
The SMS market dominated the Global Out-of-band (OOB) Authentication Market by Authentication Channel in 2024; thereby, achieving a market value of $1.66 billion by 2032. The Token-Based market is expected to witness a CAGR of 16.1% during (2025 - 2032). SMS-based out-of-band authentication is widely used due to its simplicity, broad accessibility, and ease of deployment across diverse user bases. Organizations leverage SMS authentication to deliver one-time passwords and verification codes directly to users’ mobile devices. High mobile phone penetration makes SMS a practical authentication channel for banking, e-commerce, and enterprise access.
The BFSI segment led the Global Out-of-band (OOB) Authentication Market by End-User Industry in 2024, growing at a CAGR of 15.1 % during the forecast period. The BFSI sector is a primary adopter of out-of-band (OOB) authentication due to the critical need to secure financial transactions and customer identities. Banks, insurance providers, and financial institutions deploy OOB authentication to protect online banking, digital payments, and account access. Rising incidents of fraud, phishing, and identity theft have increased reliance on multi-factor authentication mechanisms. OOB authentication enhances trust by adding an additional verification layer beyond traditional credentials.
The North America market dominated the Global Out-of-band (OOB) Authentication Market by Region in 2024, and would continue to be a dominant market till 2032; thereby, achieving a market value of $1,629.8 million by 2032. The Europe market is expected to witness a CAGR of 15.4% during (2025 - 2032). Additionally, The Asia Pacific market is expected to witness a CAGR of 16.4% during (2025 - 2032).
By Components
By Deployment
By Authentication Channel
By End-User Industry
By Geography
Unique Offerings
