Tokenization Market Forecast Size and Growth 2031

Tokenization Market Size and Forecast (2021–2031), Global and Regional Share, Trend, and Growth Opportunity Analysis Report Coverage: By Component (Solution and Services), Deployment (Cloud and On-premise), Enterprise Size (SMEs and Large Enterprises), Industry Vertical (BFSI, Retail, IT & Telecom, Healthcare, Government, and Others), and Geography

  • Report Code : TIPRE00003042
  • Category : Technology, Media and Telecommunications
  • No. of Pages : 150
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Tokenization Market Size 2021-2031 | Drivers and Opportunities

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The tokenization market size is projected to reach US$ 11.18 billion by 2031 from US$ 2.87 billion in 2023. The market is expected to register a CAGR of 18.5% in 2023–2031. Rising digitalization, availability of a variety of online payment methods, and an increasing number of online transactions are likely to remain a key tokenization market trend.

Tokenization Market Analysis

The tokenization market is growing at a rapid pace due to the increasing data breach activities and growing data security concerns among consumers across the globe. The market is expanding steadily, driven by the consumer demand for contactless payment. Moreover, the growing demand for cloud-based tokenization and government initiatives for cashless transactions are providing lucrative opportunities for tokenization market growth.

Tokenization Market Overview

Tokenization is the process of exchanging or converting sensitive data for nonsensitive data into smaller parts called “tokens.” It can be used in a database or internal system without bringing it into scope. Tokens have almost no intrinsic value; they are only helpful when they represent something important, such as a credit card primary account number (PAN) or Social Security number (SSN). Most organizations store sensitive data in their systems, whether it's credit card information, medical information, social security numbers, or anything else that has to be secure and protected. Tokenization allows enterprises to continue using this data for commercial purposes without the risk or compliance implications of retaining sensitive data internally.

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Tokenization Market: Strategic Insights

Tokenization Market

  • CAGR (2023 - 2031)
    18.5%
  • Market Size 2023
    US$ 2.87 Billion
  • Market Size 2031
    US$ 11.18 Billion

Market Dynamics

GROWTH DRIVERS
  • Increasing Data Breach Activities
FUTURE TRENDS
  • Rising digitalization, availability of a variety of online payment methods, and an increasing number of online transactions
OPPORTUNITIES
  • Growing Demand for Cloud-based Tokenization

Key Players

  • Broadcom, Inc
  • FUTUREX
  • Fiserv, Inc.
  • Micro Focus International plc
  • OpenText Corporation
  • Sequent Software Inc
  • TokenEx
  • Thales SA
  • Visa Inc
  • Mastercard International Incorporated

Regional Overview

  • North America
  • Europe
  • Asia-Pacific
  • South and Central America
  • Middle East and Africa

Market Segmentation

Component
  • Solution
  • Services
Deployment
  • Cloud
  • On-premise
Enterprise Size
  • SMEs
  • Large Enterprises
  • BFSI
  • Retail
  • IT & Telecom
  • Healthcare
  • Government
  • Others
  • Sample PDF showcases the content structure and the nature of the information with qualitative and quantitative analysis.

Tokenization Market Drivers and Opportunities

Increasing Data Breach Activities is Driving the Market

Criminals target businesses that accept debit cards and credit credits. The payment made from these cards contains valuable information that can be stolen. This increases the adoption of tokenization among businesses to protect valuable information. Tokenization helps businesses to protect themselves from any negative financial consequences of data theft. Tokenization not only protects financial information but also supports businesses to protect their personal data from breaches. Moreover, the growing adoption of credit card tokenization among businesses to improve data security for online businesses is driving the market. Tokenization provides data security from the time data is being captured to storage by eliminating the actual storing of credit card numbers in POS machines and internal systems.

Growing Demand for Cloud-based Tokenization – An Opportunity in the Tokenization Market

Cloud-based tokenization is the process of exchanging sensitive data for an irreversible, non-sensitive placeholder known as a token while securely maintaining the original, sensitive data outside of the business's internal systems. Cloud-based tokenization is easier to implement and less expensive than traditional on-premise tokenization. This helps businesses in lowering risk and compliance exposure by removing sensitive data from their data environments. Businesses can also safeguard that data while maintaining utility and the agility of their current business processes by utilizing format- and length-preserving tokens as a placeholder for the original, sensitive data. This is significantly creating opportunities in the market during the forecast period.

Tokenization Market Report Segmentation Analysis

Key segments that contributed to the derivation of the tokenization market analysis are component, deployment, enterprise size, and industry vertical.

  • Based on component, the tokenization market is divided into solution and services. The solution segment held a larger market share in 2023.
  • In terms of deployment, the market is categorized as cloud and on-premise. The cloud segment held a larger market share in 2023.
  • On the basis of enterprise size, the tokenization market is divided into SMEs and large enterprises. The SMEs segment held a larger market share in 2023.
  • In terms of industry vertical, the tokenization market is segmented into BFSI, Retail, IT & telecom, healthcare, government, and others. The BFSI segment held a larger market share in 2023.

Tokenization Market Share Analysis by Geography

The geographic scope of the tokenization market report is mainly divided into five regions: North America, Asia Pacific, Europe, Middle East & Africa, and South America/South & Central America.

In terms of revenue, North America accounted for the largest tokenization market share, due to the rapid adoption of new innovative technologies and increasing demand for cloud-based solutions among businesses. Increasing use of online payment methods and growing buy now, pay later with cryptocurrencies is fueling the market. Many financial firms in the US, such as Visa and Mastercard, are providing online transaction services and payment solutions to customers across the globe. This increases the demand for tokenization for protecting data. For instance, in August 2022, Visa issued over 4 billion network tokens globally through Visa Token Service (VTS) to support digital tokens.

Tokenization Market Report Scope

Report Attribute Details
Market size in 2023 US$ 2.87 Billion
Market Size by 2031 US$ 11.18 Billion
Global CAGR (2023 - 2031) 18.5%
Historical Data 2021-2022
Forecast period 2024-2031
Segments Covered By Component
  • Solution
  • Services
By Deployment
  • Cloud
  • On-premise
By Enterprise Size
  • SMEs
  • Large Enterprises
By
  • BFSI
  • Retail
  • IT & Telecom
  • Healthcare
  • Government
  • Others
Regions and Countries Covered North America
  • US
  • Canada
  • Mexico
Europe
  • UK
  • Germany
  • France
  • Russia
  • Italy
  • Rest of Europe
Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific
South and Central America
  • Brazil
  • Argentina
  • Rest of South and Central America
Middle East and Africa
  • South Africa
  • Saudi Arabia
  • UAE
  • Rest of Middle East and Africa
Market leaders and key company profiles
  • Broadcom, Inc
  • FUTUREX
  • Fiserv, Inc.
  • Micro Focus International plc
  • OpenText Corporation
  • Sequent Software Inc
  • TokenEx
  • Thales SA
  • Visa Inc
  • Mastercard International Incorporated
    • Sample PDF showcases the content structure and the nature of the information with qualitative and quantitative analysis.

    Tokenization Market News and Recent Developments

    The tokenization market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. The following is a list of developments in the market for tokenization and strategies:

    • January 2024: The BIS Innovation Hub announces the first six projects for the 2024 work program, including upcoming projects focusing on safety and security, green finance, and next-generation financial infrastructures, and additional work on advanced data analytics and tokenization is also planned. (Source: BIS, Press Release, 2024)

    Tokenization Market Report Coverage and Deliverables

    The “Tokenization Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:

    • Market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
    • Market dynamics such as drivers, restraints, and key opportunities
    • Key future trends
    • Detailed PEST/Porter’s Five Forces and SWOT analysis
    • Global and regional market analysis covering key market trends, major players, regulations, and recent market developments
    • Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments
    • Detailed company profiles
    Report Coverage
    Report Coverage

    Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends

    Segment Covered
    Segment Covered

    Component , Deployment , Enterprise Size , Industry Vertical , and Geography

    Regional Scope
    Regional Scope

    North America, Europe, Asia Pacific, Middle East & Africa, South & Central America

    Country Scope
    Country Scope

    Argentina, Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Russian Federation, Saudi Arabia, South Africa, South Korea, United Arab Emirates, United Kingdom, United States

    Frequently Asked Questions


    What is the incremental growth of the global tokenization market during the forecast period?

    The incremental growth expected to be recorded for the global tokenization market during the forecast period is US$ 8.31 billion.

    What will be the market size of the global tokenization market by 2031?

    The global tokenization market is expected to reach US$ 11.18 billion by 2031.

    Which are the key players holding the major market share of the global tokenization market?

    The key players holding majority shares in the global tokenization market are Broadcom, Inc, FUTUREX, Fiserv, Inc., Micro Focus International plc, and OpenText Corporation.

    What are the future trends of the global tokenization market?

    The Rising digitalization, availability of a variety of online payment methods, and increasing number of online transactions are anticipated to play a significant role in the global tokenization market in the coming years.

    What are the driving factors impacting the global tokenization market?

    The increasing data breach activities and growing data security concerns among consumers across the globe are the major factors that propel the global tokenization market.

    What is the estimated market size for the global tokenization market in 2023?

    The global tokenization market was estimated to be US$ 2.87 billion in 2023 and is expected to grow at a CAGR of 18.5% during the forecast period 2023 - 2031.

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