The overall Automatic Identification and Data Capture Market is expected to grow from USD 40.1 billion in 2020 to USD 80.3 billion by 2025; it is expected to grow at a CAGR of 14.9% during 2020–2025.
Key factors fueling the growth of this market include growing e-commerce industry globally; increasing use of smartphones for QR code scanning and image recognition; rising adoption of AIDC solutions due to their ability to minimize queuing and transaction time and provide greater convenience to users in making small-value payments; and surging adoption of AIDC solutions by banking and financial institutions to ensure customer safety and security, along with data privacy. An increasing number of patients and deaths due to COVID-19 will force all the countries to increase their healthcare expenditure, which is expected to have a positive impact on the growth of the market for AIDC products.
Download PDF Brochure:
Driver: Growing e-commerce industry globally
Automatic identification and data capturing products including barcoding solutions, wearables, and radio frequency identification (RFID) solutions play a vital role in the e-commerce industry, as well as in warehouse management. The implementation of AIDC technology not only helps the e-commerce industry to automatically identify the items, collect the data about them with high accuracy and precision, and enter this data electronically into the computer system. The technology also helps improve the overall productivity and operational efficiency by keeping a proper track of inventory, accounts, human resources, and overall processes. The most common devices used to identify and capture the data are barcode scanners, rugged tablets, handheld and fixed-position laser scanners and imagers, RFID tags and readers, wearables devices, and voice recognition solutions. Typical applications of these solutions in the e-commerce industry and warehouse management include inventory, asset, and workflow management; order fulfilment; and minimizing the queuing and transaction time; among many others. Barcoding solutions and RFID systems have been widely adopted in the e-commerce industry for labelling and storing information about the product.
Restraint: High installation cost of AIDC solutions
The high cost of installation is one of the major factors hindering the adoption of automatic identification and data capturing products by small and medium-sized enterprises. When automatic identification and data capturing products such as smart cards are installed, it is necessary to install one or two contactless point-of-sale terminals, which is highly expensive for small and medium-sized companies having limited capital to invest. Similarly, many small retail merchants still rely more on cash transactions rather than credit or debit cards for payments. For traditional bank acquirers and contactless payment service providers (PSPs), this acts as a significant hindrance in the propagation of card-based acceptance solutions.
Opportunity: Imposing governments regulations for adoption of AIDC solutions
Government institutions across the world adopt automatic identification and data capturing technologies, such as biometrics and smart cards, for identification and verification applications. The US is the pioneer in adopting biometric solutions. According to a report submitted by the US Government Accountability Office (GAO), the Department of Homeland Security expenditure exceeded USD 13 billion in 2015. The governments of technologically advancing nations, such as India and China, are committed to improving the quality of services in public safety and healthcare sectors. The Government of India has introduced unique identification cards (Aadhaar) in which biometrics technology is used to provide a unique identification number to every citizen, which has created a massive opportunity for biometric technology in India. In January 2018, the Government of India also added face authentication technology, along with iris and fingerprint authentication technologies in Aadhaar.
Challenge: Malware attacks and security breaches
Security issues such as malware attacks or data duplication are among a few of the major challenges faced by the automatic identification and data capture products, ultimately creating challenges for the players in this market. These security lapses undermine the objective of the implementation of automatic identification and data capture technologies, particularly biometrics, whose sole purpose is to offer enhanced and an extra layer of security. A biometric system consists of image capture and processing devices, communication channels, and databases, which are subject to a wide spectrum of replay attempts and other forms of adversary attacks. The biometric sample captured in the access control application can be intercepted and misused to enable illegitimate authentication.