Rising Need for Robust Detection Systems that can Adapt to New Threats is Driving the Growth of the Global Fraud Detection Transaction Monitoring Market

As financial fraud schemes continue to evolve and become more sophisticated, there is a rising need for robust fraud detection systems that can effectively adapt to new threats. Traditional fraud detection methods often struggle to keep pace with the rapid changes in fraud tactics, making it essential for financial institutions and businesses to implement advanced detection systems. These systems need to leverage cutting-edge technologies such as artificial intelligence and machine learning to analyze large volumes of transaction data in real time, identifying patterns and anomalies that may indicate fraudulent activity.

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Data Bridge Market Research analyses that the Global Fraud Detection Transaction Monitoring Market is expected to reach USD  81.91 billion by 2031 from USD 17.01 billion in 2023, growing with a CAGR of 21.8% in the forecast period of 2024 to 2031.

Key Findings of the Study

Increased Focus on Identity Verification and Authentication

The heightened emphasis on identity verification and authentication is transforming the landscape of fraud detection and transaction monitoring. By incorporating advanced technologies such as biometric authentication, multi-factor verification, and AI-driven identity analysis, financial institutions can more accurately verify user identities and detect fraudulent activities. This robust approach helps mitigate risks associated with unauthorized access and fraudulent transactions, enhancing the overall security and reliability of financial systems. As identity verification technologies evolve, they will play a crucial role in strengthening fraud detection mechanisms and ensuring the integrity of transaction monitoring processes.

Report Scope and Market Segmentation

Segment Analysis

The global fraud detection transaction monitoring market is segmented into six notable segments based on the offering, function, deployment mode, organization size, application, and vertical.

• On the basis of offering, the global fraud detection transaction monitoring market is segmented into solution and services

In 2024, solution segment is expected to dominates the global fraud detection transaction monitoring market

In 2024, the solution segment is expected to dominate the market with a market share of 65.34% due to the increasing demand for advanced tools that offer real-time monitoring, risk assessment, and automated fraud detection, enabling organizations to minimize financial losses and comply with regulations efficiently.

•  On the basis of function, the global fraud detection transaction monitoring market is segmented into KYC/customer on-boarding, case management, watch list screening, dashboard & reporting, and others

 In 2024,  KYC/customer on-boarding segment is expected to dominate the global fraud detection transaction monitoring market

In 2024, the KYC/customer on-boarding segment is expected to dominate the market with a market share of 31.91% due to increasing demand for real-time transaction monitoring across BFSI sector.

• On the basis of deployment mode, the global fraud detection transaction monitoring market is segmented into cloud and on-premise. In 2024, the cloud segment is expected to dominate the market with a market share of 57.80%
• On the basis of organization size, the global fraud detection transaction monitoring market is segmented into large size organizations and small & medium sized organization. In 2024, large size organizations segment is expected to dominate the market with a market share of 62.49%
• On the basis of application, the global fraud detection transaction monitoring market is segmented into payment fraud detection, money laundering detection, account takeover protection, identity theft prevention, and others. In 2024, payment fraud detection segment is expected to dominate the market with a market share of 37.84%
• On the basis of vertical, the global fraud detection transaction monitoring market is segmented into Banking, Financial Services, and Insurance (BFSI), retail, IT & telecommunication, government & defense, healthcare, manufacturing, energy & utilities, and others. In 2024, Banking, Financial Services, and Insurance (BFSI) segment is expected to dominate the market with market share of 38.98%

Major Players

Data Bridge Market Research analyzes Amazon Web Services, Inc. (U.S), LexisNexis Risk Solutions (U.S), Mastercard (U.S), TATA Consultancy Services Limited (India), Fiserv, Inc. (U.S) as the major companies operating in the global fraud detection transaction monitoring market.

Market Developments

• In July 2023, Mastercard launched an AI-driven real-time anti-fraud tool called "Consumer Fraud Risk" in the UK, partnering with nine major banks, including Lloyds, Halifax, and NatWest. This system aimed to detect scams before funds left victims' accounts, using AI to predict and block fraudulent transactions. TSB, one of the first banks to adopt the tool, saw a 20% increase in fraud detection over four months. Mastercard projected that widespread use of this system could prevent nearly USD 127 million in scam payments annually in the U.K
• In August 2024, LexisNexis unveiled LexisNexis Protégé at ILTACON, a breakthrough Legal AI Assistant integrated into the third-generation Lexis+ AI. The announcement generated significant buzz by showcasing Protégé's personalized, user-controlled AI capabilities for the legal sector. This innovation positioned LexisNexis as a leader in transforming legal workflows with advanced generative AI, driving industry excitement and enhancing the company’s reputation
• In April 2024, Amazon Web Services, Inc., recently extended its collaboration with Zilch to advance AI innovation, utilizing AWS's AI and ML services such as Amazon SageMaker and Amazon Bedrock. This partnership enabled Zilch to significantly enhance data processing, shorten development times, and improve customer personalization and fraud detection. The expanded use of AWS is projected to accelerate Zilch’s sales and enhance model performance over the next two years
• In July 2023, Mastercard unveiled its AI-powered Consumer Fraud Risk solution in the U.K., significantly improving the real-time detection of payment scams. The technology helped TSB prevent scam payments and potentially saved £100 million annually across the U.K. by identifying fraudulent transactions before funds were lost. The expansion of this solution aims to enhance fraud prevention and restore trust in digital banking
• In March 2024, Tata Consultancy Service Limited Quartz successfully implemented by Entris Banking for Compliance solution to enhance its fraud detection and compliance capabilities. The AI-driven platform improved transaction monitoring, risk management, and adherence to AML regulations, benefiting Entris and its 40+ affiliate banks. The solution provided advanced surveillance and efficient compliance management, boosting operational accuracy and flexibility
• In October 2020, Fiserv, Inc. introduced its first intelligent fraud detection solution for card issuers, advance defense, leveraging cognitive AI to recommend tailored fraud rules based on both institutional and consortium data. This innovation helped issuers to quickly identify fraud and reduce false declines, enhancing consumer experience and operational efficiency. By optimizing fraud prevention and cardholder satisfaction, Fiserv’s Advance Defense contributed to increased revenue and improved data access for financial institutions
• In August 2024, Tata Consultancy Service Limited was named a Leader in IDC MarketScape for Worldwide Enterprise Analytics and AI Business Process Services for Finance and Accounting. The recognition highlighted TCS's extensive capabilities in advanced analytics, AI, and generative AI, enhancing efficiency and decision-making across the finance value chain. This accolade underscored TCS's commitment to driving digital transformation and value creation for its clients

Regional Analysis

Geographically, the countries covered in the global fraud detection transaction monitoring market report are U.S., Canada, Mexico, Germany, France, U.K., Italy, Spain, Russia, Turkey, Belgium, Netherlands, Switzerland, Norway, Finland, Denmark, Sweden, Poland, rest of Europe, Japan, China, South Korea, India, Australia, New Zealand, Singapore, Thailand, Malaysia, Indonesia, Philippines, Taiwan, Vietnam, rest of Asia-Pacific, U.A.E, Saudi Arabia, South Africa, Egypt, Israel, Bahrain, Oman, Qatar, Kuwait, rest of Middle East and Africa, Brazil, Argentina, and rest of South America.

As per Data Bridge Market Research analysis:

North America is expected to dominate and be the fastest growing region in the global fraud detection transaction monitoring market

North America is expected to dominate the fraud detection transaction monitoring market due to its dominance in the fraud detection and transaction monitoring market is primarily driven by its robust financial sector, advanced technology companies, and strong emphasis on data privacy and security the region's strong emphasis on data privacy and security has fostered a conducive environment for the adoption of advanced fraud prevention measures.

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