PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1599849
PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1599849
Online Payment Fraud Detection Market Assessment, By Component, By Deployment, By Application, By End-user, By Region, Opportunities and Forecast, 2017-2031F
Global online payment fraud detection market is projected to witness a CAGR of 15.02% during the forecast period 2024-2031, growing from USD 8.36 billion in 2023 to USD 25.58 billion in 2031.
Due to several factors, the market for online payment fraud detection is growing at a breakneck speed. The exponential growth in e-commerce transactions and mobile payments continues to drive the need for efficient fraud detection systems. Above all, technological advancements pertaining to AI, machine learning, and real-time analytics are influencing this revolution, with new techniques pushing advanced capabilities to prevent fraud and ensure their identification. Enhanced consumer awareness of cybersecurity and regulatory compliance compel businesses to invest in robust fraud detection solutions. Joint efforts between financial institutions, technology providers, and regulatory bodies have given the necessary ground for innovative and comprehensive security measures.
Rising volumes of digital banking transactions and IoT device proliferation further fuel the demand for fraud detection solutions. It integrates blockchain technology, bringing in additional layers of security, therefore, cloud-based solutions scale perfectly and reduce costs. As the sophistication of cybersecurity threats continues to rise, the need for such advanced fraud detection measures. Simply put, the overall market scenario is born out of a seamless amalgamation of technological integration with regulatory pressures, consumer demand for security, and constant investment in cyber infrastructure. This dynamic environment will ensure that the online payment fraud detection market continues to grow with the basic need to protect financial transactions and build consumer confidence.
For instance, in August 2024, Experian, the world's leading global information services company, has launched Aidrian, a new cloud-based fraud solution powered by adaptive Machine Learning, which enables businesses to prevent fraud without impacting the customer experience. Experian recognized that businesses need to lower their fraud levels without impacting conversion rates, so they created Aidrian, an innovative fraud solution focusing on revenue growth. Aidrian's ability to differentiate between legitimate customers and fraudsters can significantly reduce false positives, helping generate up to 15% more revenue for clients, as per their claims.
Rising Cyber Threats to Demand Enhanced Fraud Detection Systems
The rising cyber threats are creating an immediate need for advanced fraud-detection systems. As cybercriminals increasingly use sophisticated methods to break through security measures, the requirement for strong fraud-detection mechanisms has never been stronger. Solutions based on AI, ML, and behavioral analytics are growing in the market and help predict and prevent fraudulent activities with great efficiency.
Technological advancements have led to the evolution of fraud detection systems, taking it up a notch with better accuracy and higher efficiency with AI and ML. The number of data sets can be analyzed to make decisions in real time and flag suspicious transactions. Biometrics and behavioral analytics enhance protection against online payment fraud. Businesses have comprehensive security solutions tailored to counter the evolution of cyber threats.
For instance, in 2024, CyberArk, global leader in Identity Security based in the United States, released their Threat Landscape Report after a global survey of 2,400 security decision-makers across 18 countries, in which it was revealed that out of these, 94% experienced an identity-related breach at least once and 93% experienced two or more identity-related breaches.
Rising Online Transactions to Drive Market Growth
The growth of the online transactions market across the globe has been dramatically rapid due to ever-increasing adoption of e-commerce, mobile banking, and digital payment platforms, thereby increasing the danger of fraud in online payment significantly. With more consumers shopping digitally, the various online modes for payments, including credit cards and mobile wallets, are increasingly being used, and fraudsters exploit the weakness of such systems to steal and carry out unauthorized transactions. This increases fraudulent activities, hence, companies have the need to invest in advanced fraud detection solutions to protect customers and trust in the digital marketplace. By using some of the latest technologies, such as artificial intelligence machine learning, and behavioral analytics, companies take advantage of it. These technologies enable them to monitor some suspicious patterns in millions of transactions quickly and thereby enhance the accuracy and efficiency of fraud detection systems.
For example, as reported by the Government of India, total digital payment transactions volume increased from 20.71 billion in FY2017-FY2018 to 134.62 billion in FY2022-FY2023 at a CAGR of 45%. During the current FY2023-2024, digital payments transactions have reached 116.60 crores till 11th December 2023. This shows how digital transactions continue to rise.
Government Initiatives to Act as a Market Catalyst
Governments worldwide are imposing strict regulations to fight online fraud through payments and protect the rights of consumers. To this end, businesses must include strong fraud-detection measures to protect sensitive customer information besides loss mitigation. Failure to comply with such requirements may lead to heavy fines and damage to reputation, and hence the need for compliance that organizations should take quite seriously. Effective compliance with such regulations for online transactions is highly critical to the evolving nature of the online transaction landscape. Several measures, such as Anti-Money Laundering (AML) Directives by the European Union, PCI DSS, and Indian Computer Emergency Response Team (CERT-In), are done to maintain the order.
For instance, in October 2024, Bhutan Computer Incident Response Team (BtCIRT) launched the National Cybersecurity Strategy 2024-2029, during the National Cybersecurity Conference 2024. The Strategy aims to protect cyberspace and combat various aspects of cybersecurity risks and threats that could adversely affect people, businesses, and the government. In nine years, Bhutan Computer Incident Response Team (BtCIRT) under GovTech has handled over 1,388 cybersecurity threats and attacks, with 204 incidents in 2024.
BFSI Sector to Dominate the Online Payment Fraud Detection Market Share
BFSI sector is highly dominating in terms of volume and has commanded the highest demand for online payment fraud detection. This is due to the high vulnerability to payment frauds and the high volumes it engages in daily. Thus, the BFSI companies make significant investments in advanced fraud detection and prevention solutions that protect their operations and customer transactions from any type of fraud. Financial institutions deal with very sensitive information, such as personal identification information, account details, and other related histories. Such information calls for the greatest protection to maintain customer trust and regulatory compliance. Some of the widely applied fraud detection techniques in BFSI are machine learning algorithms, behavioral analytics, real-time monitoring, and others. BFSI must adhere to strict regulatory compliance related to money laundering and fraud prevention.
Table of Contents
1. Project Scope and Definitions
2. Research Methodology
3. Executive Summary
4. Voice of Customer
- 4.1. Product and Market Intelligence
- 4.2. Mode of Brand Awareness
- 4.3. Factors Considered in Purchase Decisions
- 4.3.1. Features and Other Value-added Service
- 4.3.2. IT Infrastructure Compatibility
- 4.3.3. Real-time Detection and Speed
- 4.3.4. Ease of Integration
5. Global Online Payment Fraud Detection Market Outlook, 2017-2031F
6. North America Online Payment Fraud Detection Market Outlook, 2017-2031F*
7. Europe Online Payment Fraud Detection Market Outlook, 2017-2031F
8. Asia-Pacific Online Payment Fraud Detection Market Outlook, 2017-2031F
9. South America Online Payment Fraud Detection Market Outlook, 2017-2031F
10. Middle East and Africa Online Payment Fraud Detection Market Outlook, 2017-2031F
11. Demand Supply Analysis
12. Value Chain Analysis
13. Porter's Five Forces Analysis
14. PESTLE Analysis
15. Market Dynamics
16. Market Trends and Developments
17. Case Studies
18. Competitive Landscape
19. Strategic Recommendations
20. About Us and Disclaimer
List of Tables
- Table 1. Pricing Analysis of Products from Key Players
- Table 2. Competition Matrix of Top 5 Market Leaders
- Table 3. Mergers & Acquisitions/ Joint Ventures (If Applicable)
- Table 4. About Us - Regions and Countries Where We Have Executed Client Projects
List of Figures
- Figure 1. Global Online Payment Fraud Detection Market, By Value, In USD Billion, 2017-2031F
- Figure 2. Global Online Payment Fraud Detection Market Share (%), By Component, 2017-2031F
- Figure 3. Global Online Payment Fraud Detection Market Share (%), By Deployment, 2017-2031F
- Figure 4. Global Online Payment Fraud Detection Market Share (%), By Application, 2017-2031F
- Figure 5. Global Online Payment Fraud Detection Market Share (%), By End-user, 2017-2031F
