The mobile ID market, based around universal log-ins and mobile identity services, is currently worth around $20m (£13m), but could be generating an additional $700m by 2020, as customer concerns over data theft spur operators to offer additional services.

The prediction comes from Juniper Research, from a new paper on mobile identity, authentication and tokenisation, which found that as online engagement has soared, the limitations of a password-based approach are being increasingly exposed.

Recent high profile hacks like TalkTalk, Ashley Madison, Samsung and T-Mobile have left the public increasingly aware of the need for strong digital security, but as the scale of data theft rises dramatically, there are more and more calls for alternatives to simple passwords.

The research estimates that the number of data breaches worldwide is expected to rise from just under 6,000 this year to over 16,000 by 2020, with an average of 500,000 records exposed per breach, rapidly eroding consumer confidence and leaving users open to fraud.

In this environment, there will increasing demand on operators and service providers to create more secure alternatives to passwords that guarantee better security, and this demand will fuel a massive growth in the market.

The research claims that the business case for mobile ID solutions has yet to be fully established, but solutions like those endorsed by the GSMAs Mobile Connect Initiative, which use  a mobile number and a single pin, could be the future of log-in security. Monetising these solutions could be difficult, but even a low-level subscription charge could generate a substantial uplift in consumer spending.

“It is imperative to reduce online user pain points,” said Dr Windsor Holden, author of the research paper. “Enabling a single, secure mode of entry could be a key development in this regard.”