Europe’s online banking identity authentication market has
“taken off,” proclaimed French remote transactions hardware and
software vendor Xiring in a review of its 2007 results. Backing its
optimism, Xiring noted that by the end of 2007 10 million consumers
in Belgium, the Netherlands, Switzerland, Sweden and the UK had
been equipped with authentication solutions and predicted that by
2010 the number would reach 60 million.
Reflecting robust demand, Xiring reported sales of €23.8 million
($35 million) in 2007, an 86 percent increase compared with 2006
and up from €6.3 million in 2005. According to Xiring it has
achieved the status of “market leader” in the overall European
authentication solutions market holding an overall 50 percent
market share.
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Xiring’s position is even stronger in the UK where it claims to
have a 70 percent share market share. By the end of 2007, Xiring
said it had delivered more than 3 million of its O2S authentication
solutions to UK banks of which more than 1 million were delivered
to a new “large British client” in the fourth quarter of 2007. A
significant growth driver in the UK is the soon to be launched
Faster Payment initiative that has forced banks to increase
security of remote transactions.
The O2S solution, launched in 2005, meets specifications
developed by MasterCard and Visa and includes a range of devices
that include connected and unconnected EMV smart card readers that
operate on single-use password, two-factor authentication or data
digital signature systems.
Strong demand for authentication systems has seen this segment
of Xiring’s business increase significantly in importance in recent
years, replacing the French healthcare sector as its primary sales
generator. Xiring reported that it had achieved sales of online
banking security solutions of €12.6 million in 2007, up from €3.7
million in 2006 and €2.2 million in 2005. Online banking security
increased from 2`9 percent of total sales in 2006 to 53 percent in
2007.
However, despite the rise in importance of security systems, the
French healthcare sector remains an important aspect of Xiring’s
business, generating sales of €9.3 million in 2007, up 38 percent
compared with 2006. Xiring’s focus is on the SESAM-Vitale
electronic claims system in which also justifiably lays claim to
being the market leader.
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By GlobalDataThe SESAM-Vitale system which links 210,000 healthcare
professionals with the health insurance system is supported by
about 48 million smart cards and each year processes about 1
billion claims electronically.
According to Xiring more than 100,000 of its smart card readers
have been deployed by health professionals, giving it an almost 50
percent share in this segment. In addition, 15,000 Xiring terminals
deployed by pharmacies represent more than 50 percent of this
segment.
Xiring painted an optimistic picture of its prospects in 2008,
forecasting an increase of almost 20 percent in sales to €28.5
million. In particular, it noted that in the banking market it
would build on pilot projects in European countries where
authentication solutions are yet to be rolled out. This includes
France, Italy, Portugal, Turkey, Croatia and Slovenia.
In Europe Xiring stands to benefit from the roll-out of the
Single Euro Payment Area initiative which requires strong user
authentication and the use of digital signatures for online
transactions. Xiring estimates that the potential bank customer
user base for online security solutions in Europe is 130
million.
