AI-Based Optical Character Recognition Market Size, Share, Opportunities, And Trends By Input Type (Image, Documents, Scanners), By End-Users (BFSI, Government, Airports, Healthcare, Retail, Others), And By Geography - Forecasts From 2023 To 2028

The AI-based optical character recognition market is forecasted to witness a growth of CAGR of 18.64%, to reach US$21.039 billion by 2029, from US$8.952 billion in 2024.

Optical character recognition (OCR) is the application of AI technology and software in the conversion of visual image and digital text input into machine-readable input structure. The ability of artificial intelligence-based optical character recognition technologies to process handwritten texts. The integration of AI-based OCR software with other technologies, including machine learning algorithms, is widening the application scope of this market across various sectors, such as the BFSI, healthcare, retail, transportation, and other sectors. Hence, in view of the advancements in AI technology and the increasing AI adoption rates across all major economies of the world, it can be anticipated that the optical character recognition market will significantly expand over the forecast period.

What are AI-based optical character recognition market drivers?

• Digitalization of business processes

The digitalization of companies' business operations in different fields due to increasing demand for transparency and virtual access to information is creating opportunities for advancing the AI-enabled OCR software market. Optical Character Recognition and Intelligent Character Recognition technologies are the most commonly used devices for a company's digitalization procedures. The OCR and ICR software applications amalgamated with document scanning software help in automating the extraction of relevant data and re-entering the extracted data in digital storage spaces. The universal shift among companies and brands operating in different sectors of an economy towards digitalization is contributing majorly to the AI-based OCR tools market.

• The rigorous paperwork in the BFSI and logistics sectors

Incorporating AI-based OCR software in the banking and financial services industry and the logistics division of different operating companies enables customers to reduce the resources and time spent performing meticulous paperwork. The logistics sector deals with large volumes of data related to billing and shipment procedures, and streamlining the logistics activities with OCR software aids in extracting required data from shipping invoices, delivery bills, and purchase orders. For instance, the InstSig OCR platform comprises several OCR tools, one of which is utilized for automating the logistics and supply chain department. Apart from this, the banking and financial services industry is another sector that deals with enormous paperwork filing requirements. The availability of several OCR software such as Hyperscience, Ascend Software, Kfax, and Docsumo with customized features to enable their applications in the financial services and banking sector assists in reducing the paperwork load by automating the analysis of bank statements, invoices, and receipt documents, and the verification of customers. Hence, the digitalization of various business activities and the heavy amount of paperwork in the BFSI and logistics sector will propel this market’s growth over the forecast period.

Major challenges in the AI-based optical character recognition market:

• Inaccuracy of AI-enabled OCR software

The effective working of AI-based optical recognition character software applications requires a clear visual input or text image. The scanned image of any document to be processed using OCR software must contain characters that can be differentiated from the image background and should have proper alignment structure along with accurate image resolution.

In case of a blurry image or input, the accuracy of OCR software plummets significantly, leading to unreliable output, which must be manually verified. This could slow down the adoption of AI-enabled OCR technology by companies dealing with a heavy amount of documents that need to be constantly processed with higher precision rates. However, AI-powered OCR products can be integrated with deep learning solutions or image editing software to reduce the disturbances in the image and enhance the image quality.

AI-based optical character recognition market

• Asia Pacific is forecasted to hold a major share of the AI-based optical character recognition market.

The AI optical character recognition market in the Asia Pacific region is experiencing significant growth due to the escalating investments in the AI field and the emergence of new AI technological startup companies. Hive.ai by Hive Company, ThinkAutomation by Parker Software, Adobe PDF Library by Datalogics Inc., Invoice Extractor by Affinda, and FineReader PDF by Abbyy are a few popular AI-based OCR software used across different countries in this region. In addition to this, the AI software with OCR features released by leading technology companies such as Microsoft Azure, Google Cloud Vision, and Amazon Rekognition are experiencing growing demands from APAC countries.

Furthermore, the e-commerce retail segment’s growth in Asian countries is further increasing OCR software demand. The application of AI-based OCR software by e-commerce businesses helps in verifying online customers’ identities to prevent any theft incidents and obtain detailed information about products in a time-efficient manner. Therefore, considering such factors contributing to the growth of AI-based OCR applications, it can be anticipated that this regional market will expand over the forecast period.

Major players and products of the AI-based optical character recognition market:

• Google is among the leading technological companies globally, offering products and solutions for multiple industries, including retail, healthcare, games, manufacturing, and supply chain & logistics. Google offers Optical Character Recognition through its Google Cloud platform.
• NAVER Cloud Corp. is a global technological solution provider that offers a wide range of products and services for multiple industries, like e-commerce, healthcare, education, media, logistics, and metaverse, among many others. The company's products include HyperCLOVA X, Digital Twins, Hybrid, Finance, and Live Commerce, among others. The company offers Clova OCR solutions in its AI-based services, which feature capabilities like OCR templates and image text recognition.

Key developments in the AI-based optical character recognition market:

• In October 2024, H2O.ai, a leading AI solution provider, launched its new multimodal foundation model, which is aimed to undertake the specific functions of Document AI use case and OCR.
• In October 2022, the Korean subsidiary of Inspur Information, Inspur Korea, collaborated with an AI-tech startup company, Upstage, to launch an improved version of AI Pack by Upstage with OCR Pack as one of its core functions. Upstage's integration of the GPU server technology of Inspur Korea into the AI pack application enabled its customers to use these software solutions with either no coding or low coding requirements.
• In September 2022, HealthPlix Technologies introduced a new AI-assisted OCR application, SmartScan, to scan through patients' lab reports and organize the information about the health vitals of patients on the EMR software platform.

AI-Based Optical Character Recognition Market Scope:

Report Metric	Details
AI-Based Optical Character Recognition Market Size in 2024	US$21.039 billion
AI-Based Optical Character Recognition Market Size in 2029	US$8.952 billion
Growth Rate	CAGR of 18.64%
Study Period	2019 to 2029
Historical Data	2019 to 2022
Base Year	2024
Forecast Period	2024 – 2029
Forecast Unit (Value)	USD Billion
Segmentation	Input Type End-Users Geography
Geographical Segmentation	North America, South America, Europe, Middle East and Africa, Asia Pacific
List of Major Companies in AI-Based Optical Character Recognition Market	NAVER Cloud Corp IDCentral Cognex Corporation Klippa App BV Qualitas Technologies
Customization Scope	Free report customization with purchase

 

The AI-Based Optical Character Recognition Market is analyzed into the following segments:

• By Input Type
  • Image
  • Documents
  • Scanners
• By End-Users
  • BFSI
  • Government
  • Airports
  • Healthcare
  • Retail
  • Others
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • United Kingdom
    • Germany
    • France
    • Italy
    • Spain
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • UAE
    • Others
  • Asia Pacific
    • China
    • Japan
    • India
    • South Korea
    • Australia
    • Singapore
    • Indonesia
    • Others

1. INTRODUCTION

1.1. Market Overview

1.2. Market Definition

1.3. Scope of the Study

1.4. Market Segmentation

1.5. Currency

1.6. Assumptions

1.7. Base and Forecast Years Timeline

1.8. Key benefits for the stakeholders

2. RESEARCH METHODOLOGY  

2.1. Research Design

2.2. Research Process

3. EXECUTIVE SUMMARY

3.1. Key Findings

4. MARKET DYNAMICS

4.1. Market Drivers

4.2. Market Restraints

4.3. Porter’s Five Forces Analysis

4.3.1. Bargaining Power of Suppliers

4.3.2. Bargaining Power of Buyers

4.3.3. The Threat of New Entrants

4.3.4. Threat of Substitutes

4.3.5. Competitive Rivalry in the Industry

4.4. Industry Value Chain Analysis

4.5. Analyst View

5. AI-BASED OPTICAL CHARACTER RECOGNITION MARKET BY INPUT TYPE

5.1. Introduction

5.2. Image

5.3. Documents

5.4. Scanners

6. AI-BASED OPTICAL CHARACTER RECOGNITION MARKET BY END-USERS

6.1. Introduction

6.2. BFSI

6.3. Government

6.4. Airports

6.5. Healthcare

6.6. Retail

6.7. Others

7. AI-BASED OPTICAL CHARACTER RECOGNITION MARKET BY GEOGRAPHY

7.1. Introduction

7.1. North America

7.1.1. By Input Type

7.1.2. By End-Users

7.1.3. By Country

7.1.3.1. United States

7.1.3.2. Canada

7.1.3.3. Others

7.2. South America

7.2.1. By Input Type

7.2.2. By End-Users

7.2.3. By Country

7.2.3.1. Brazil

7.2.3.2. Argentina

7.2.3.3. Others

7.3. Europe

7.3.1. By Input Type

7.3.2. By End-Users

7.3.3. By Country

7.3.3.1. United Kingdom

7.3.3.2. Germany

7.3.3.3. France

7.3.3.4. Italy

7.3.3.5. Spain

7.3.3.6. Others

7.4. Middle East and Africa

7.4.1. By Input Type

7.4.2. By End-Users

7.4.3. By Country

7.4.3.1. Saudi Arabia

7.4.3.2. UAE

7.4.3.3. Others

7.5. Asia Pacific

7.5.1. By Input Type

7.5.2. By End-Users

7.5.3. By Country

7.5.3.1. China

7.5.3.2. Japan

7.5.3.3. India

7.5.3.4. South Korea

7.5.3.5. Australia

7.5.3.6. Singapore

7.5.3.7. Indonesia

7.5.3.8. Others

8. COMPETITIVE ENVIRONMENT AND ANALYSIS

8.1. Major Players and Strategy Analysis

8.2. Market Share Analysis

8.3. Mergers, Acquisitions, Agreements, and Collaborations

8.4. Competitive Dashboard

9. COMPANY PROFILES

9.1. NAVER Cloud Corp

9.2. IDCentral

9.3. Cognex Corporation

9.4. Klippa App BV

9.5. Qualitas Technologies

9.6. Nano Net Technologies Inc

9.7. Docsumo

9.8. AI Gen Co Ltd

9.9. Google Inc.

9.10. Eden AI

9.11. Rossum

9.12. Alphamoon

9.13. Microsoft Inc.

 NAVER Cloud Corp 

IDCentral 

Cognex Corporation 

Klippa App BV 

Qualitas Technologies 

Nano Net Technologies Inc 

Docsumo 

AI Gen Co Ltd 

Google Inc. 

Eden AI 

Rossum 

Alphamoon 

Microsoft Inc.