Optical Character Recognition: Technology fuels Market Prospects

The optical character recognition software solutions are gaining momentum as they provide cutting-edge features that help address formatting and typography issues. It allows users to convert different types of documents and images into an editable format. According to our estimates, the optical character recognition market is expected to surge at a CAGR of 16.04% over the forecast years 2022-2028.

Technological advancement has created unidentified opportunities for businesses to digitize their work process and increase productivity. Companies across various industries are adopting OCR technology integrated with robotic process automation and artificial intelligence. For instance, Microsoft Corp acquired Nuance Communications Inc, a leader in conversational AI and ambient intelligence. However, the limitations in delivering accurate output and inaccuracy in recognizing handwritten material impede the market’s development.

Segments Supporting Global Progression

The global optical character recognition market has evolved significantly, and several industries are digitalizing their businesses which are projected to expand the market’s growth.

OCR Product Types and Benefits

The growth of digitization across businesses has increased the demand for optical character recognition products, including software and services. As per our analysis, Software leads the product segment with a CAGR of 15.58%.

The benefits of OCR software, such as identifying languages or styles of handwriting using advanced methods of intelligent character recognition (ICR), are expected to boost the demand for OCR products in the market.

Rising Adoption of OCR in the B2B Operations

The wide application of OCR for B2B users includes collecting customer information, entering identity documents, and extracting the same information in seconds. It helps in reducing errors and accurately extracting data from structured or unstructured documents such as passports, licenses, PDFs, images, etc. As a result of these benefits, various industries are implementing OCR to automate data collection, improve business productivity, and reduce costs. Thus, the B2B segment is expected to grow at a CAGR of 16.07%.

Escalating Demand for OCR in BFSI

BFSI is witnessing the fastest growth at a CAGR of 18.43%.

Financial organizations such as banks, insurance companies, and financial institutions constantly establish new records and transactions, resulting in a huge number of records and a security concern for banks. For this, the BFSI industry is increasingly adopting optical character recognition software to convert manual data into digital format, ensuring data security, storage and retrieval.

Competitive and Regional Trends

Google LLC, Microsoft Corporation, Abbyy, and Lead Technologies are some of the top companies operating in the global OCR market.

The competition in the market is significantly high owing to the presence of small and large vendors and rising investments in OCR startups. Such initiatives are expected to boost the market’s growth.

North America dominates the market with a CAGR of 15.47%.

The market is developing owing to the rapid integration of AI technology in OCR applications, government support, and increasing utilization of technology in the United States and Canada.

Asia-Pacific to witness the fastest growth rate with 17.39% CAGR.

High investments in AI and associated technologies are driving the market’s growth in the region. Also, there is a rapid increase in the number of digital startups, which is likely to present opportunities for market growth.

Technological Advancement: Key Opportunity

• The evolution of OCR technology and its developers continue to provide advanced integrated technologies, such as AI, encouraging enterprises to adopt OCR. For instance, Infrrd Inc offers a combination of machine learning and computer vision algorithms that help analyze the document’s layout.
• AI-based OCR helps companies reduce costs and increase efficiency. As a result, vendors are launching new features to cater to customers’ evolving requirements, which is expected to remain the key driver of the market’s growth.
• The rising adoption of digital technology practices has substantially aided companies in creating greater processing efficiency and reducing the risk of errors. In this regard, OCR accounts as a beneficial method that helps in easily accessing digital documents, searching a large amount of data, and quickly sharing the data.
• Many firms are implementing automated solutions to keep track of the vast volume of data, resulting in the expansion of the OCR market.

Concluding Statement

Optical character recognition technology continues to evolve and provide advanced technologies to integrate business operations, ensuring an enterprise’s streamlined data capturing, data management, and fault management. Besides, the benefits of OCR, such as advanced document protection and better customer support in various segments, are proposed to augment the optical character recognition market growth.

A. The global optical character recognition market is expected to garner $27663.91 million by 2028.

A. It is low owing to the absence of a direct supplier in the market.