Fraud Detection and Prevention Market Forecasts to 2028 - Global Analysis By Type, Component, Organization, Deployment Model, Application, Industry Vertical, and Geography

According to Stratistics MRC, the Global Fraud Detection and Prevention Market is accounted for $28.91 billion in 2022 and is expected to reach $78.70 billion by 2028 growing at a CAGR of 17.4% during the forecast period. Solutions for fraud detection and prevention work to stop frauds by locating a person and authenticating their access to the organization's IT system. The market for fraud detection and prevention is expanding as a result of the availability of big data analytics and cloud computing services.

According to report of National Audit Office (NAO) United Kingdom, around 1.9 million cyber related fraud incidents was found in 2016 in United Kingdom that results into loss of around USD11.35 billion.

Market Dynamics:

Driver:

Growing Online Application and Mobile Banking Services

An unexpectedly high number of fake websites and mobile apps have emerged as a result of the expanding use of application forms and mobile banking services. There is an increase in fake websites and online apps in different sectors like manufacturing, healthcare, retail & e-commerce, and retail & online. These websites and apps imitate retail stores and home delivery companies in an effort to lure people into fulfilling fake online interactions. Consumers in the banking industry are increasingly obsessed on smartphone platforms for a variety of purposes, including making online payments, analysing their statements, filing complaints, and providing feedback, among others.

Restraint:

High efficiencies of frauds

Since the widespread use of EMV Cards, identity fraud has gradually moved online from offline sources. Given the surge in fraud accounts, fraud complexity has also increased. Attacks by fraudsters are becoming increasingly sophisticated. An intermediate account in the names of around 1.5 million victims who already had an account is listed first. Fraudsters have an edge due to the enormous amount of personally identifiable information (PII) that is available on the black market. Many organisations, including financial institutions and retailers, have been forced to forgo more rigorous manual application review processes in order to open accounts more quickly, increasing the opportunity for crime to occur. This is due to the rising customer expectations for 24/7 digital access. Hence, the market's expansionary economic growth is hindered.

Opportunity:

Rise in usage of AI and machine learning in the banking sector

The financial and banking sectors were early adopters of risk-prevention technologies. Due to the massive internet data exchanges, financial organisations are very vulnerable. Financial institutions are also now focusing on both real-time fraud detection and financial risk mitigation. Systems for detecting fraud are developing as pattern recognition becomes more prevalent. Artificial intelligence has greatly improved thanks to machine learning (ML) technology, which may protect businesses from internal fraud and identify any abnormalities in people who might leak data. The demand for artificial intelligence and machine learning is increasing, and so is the acceptance of FDP solutions.

Threat:

Shortage of competent individuals

The growth of the global market is being hampered by several issues. The growth of the Fraud Detection and Prevention Market is projected to be hampered by the lack of qualified people to deal with fraudulent behaviour. Also, the absence of integration capabilities in fraud detection and prevention systems and services may hinder the expansion of the global market.

COVID-19 Impact

A significant market trend for fraud detection and prevention around the world has been the COVID-19 epidemic. As a result of the COVID-19 epidemic, which was brought on by the requirement for work-from-home and the expansion of online payments, the frequency of fraudulent instances increased. Online transactions are growing, and so is the amount of frauds, in exact proportion. The market revenue for fraud detection and prevention has increased as a result of this factor. The goal of fraud detection and prevention is to identify and stop attempts to acquire property or money through misrepresentation.

The SMEs segment is expected to be the largest during the forecast period

The SMEs segment is estimated to have a lucrative growth, due to increase in fraud instances inside these businesses. The growing reliance of SMEs on digital solutions and their absence of efficient security protocols are causes of cyberattacks. Due to their ignorance of scams and how they affect business profits, SMEs also struggle to monitor data protection compliance standards. Moreover, increased cross-border trade contributes to an increase in fraud. As a result, the market for solutions that can investigate, detect, prevent, and disclose frauds among SMEs is anticipated to expand in the coming years.

The Banking, financial services and insurance (BFSI) segment is expected to have the highest CAGR during the forecast period

The Banking, financial services and insurance (BFSI) segment is anticipated to witness the fastest CAGR growth during the forecast period. The competitors in the banking and financial services sector have become a popular target for hackers as a result of the increased digitization and electrification of business procedures. Additionally, the growing demand from clients for digital access to services like insurance, stock broking, and mutual funds across several touch points requires companies to implement fraud prevention systems. Moreover, the adoption of identification solutions in this industry is being stimulated by the growth in identity fraud and credit card theft incidences around the globe.

Region with highest share:

Asia Pacific is projected to hold the largest market share during the forecast period owing to the existence of expanding economies together with increased mobile and internet device penetration, rising fraud cases, and widespread industry adoption.

Region with highest CAGR:

North America is projected to have the highest CAGR over the forecast period, owing to a number of causes, including the rising use of fraud detection and prevention systems across numerous industries and the rapid growth of data processing businesses in this area. Growing public awareness of fraud incidents is also anticipated to boost the market's profitability in this area.

Key players in the market

Some of the key players profiled in the Fraud Detection and Prevention Market include: SAP SE, Oracle, Software AG, Fair Isaac Corporation ("FICO"), Dell Technologies, Total System Services, Inc., Experian, Equifax, ACI Worldwide, SAS Institute Inc., Microsoft Corporation, IBM, BAE Systems and Fiserv.

Key Developments:

In September 2022, Experian announced the release of Experian Fraud Score, a cutting-edge fraud protection tool that will assist companies of all sizes in identifying fraud at the application, transaction, and customer lifecycle stages.

In March 2022, Fiserv, with expertise in financial services technology solutions and payments, has developed a new fraud mitigation service that has reduced fraud losses, which were already low by industry standards, by 10 to 15% for its small to mid-size credit union and bank clients. False declines (legitimate transactions wrongly flagged as fraudulent) decreased by an average of 20%. The solution combines the enhanced artificial intelligence capabilities of Fico Fraud Predictor, Adaptive Analytics, and Global Intelligent Profiles, providing a cohesive, complementary, and holistic approach.

Fraud Types Covered:

• Insurance Fraud
• Identity Fraud
• Internet/Online Fraud
• Check Fraud
• Other Fraud Types

Components Covered:

• Solutions
• Services

Organizations Covered:

• Large Enterprises
• SMEs

Deployment Models Covered:

• Cloud
• On-Premise

Applications Covered:

• Payment Fraud
• Identity Theft
• Money Laundering
• Other Applications

Industry Verticals Covered:

• Government & Defense
• IT& Telecom
• Banking, Financial Services and Insurance (BFSI)
• Industrial & Manufacturing
• Retail & E-commerce
• Healthcare
• Energy & Power
• Life Sciences
• Real Estate
• Utilities
• Other Industry Verticals

Regions Covered:

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • Italy
  • France
  • Spain
  • Rest of Europe
• Asia Pacific
  • Japan
  • China
  • India
  • Australia
  • New Zealand
  • South Korea
  • Rest of Asia Pacific
• South America
  • Argentina
  • Brazil
  • Chile
  • Rest of South America
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • Qatar
  • South Africa
  • Rest of Middle East & Africa

What our report offers:

• Market share assessments for the regional and country-level segments
• Strategic recommendations for the new entrants
• Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
• Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
• Strategic recommendations in key business segments based on the market estimations
• Competitive landscaping mapping the key common trends
• Company profiling with detailed strategies, financials, and recent developments
• Supply chain trends mapping the latest technological advancements

Free Customization Offerings:

All the customers of this report will be entitled to receive one of the following free customization options:

• Company Profiling
  • Comprehensive profiling of additional market players (up to 3)
  • SWOT Analysis of key players (up to 3)
• Regional Segmentation
  • Market estimations, Forecasts and CAGR of any prominent country as per the client's interest (Note: Depends on feasibility check)
• Competitive Benchmarking
  • Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances