Fraud Detection and Prevention Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2021-2031

The Global Fraud Detection and Prevention Market is projected to expand significantly, rising from USD 38.73 Billion in 2025 to USD 106.48 Billion by 2031, reflecting a CAGR of 18.36%. This market encompasses analytical solutions and services aimed at identifying and neutralizing illicit activities within financial and commercial industries. Primary factors propelling this growth include the increasing volume of digital payments, which necessitates real-time monitoring, and strict regulatory requirements such as Anti-Money Laundering (AML) mandates. Furthermore, the urgent need to mitigate direct financial losses and safeguard brand integrity drives enterprises to implement these security measures, separate from broader technological trends affecting the sector.

A major obstacle hindering market expansion is the handling of false positives, which interfere with legitimate client interactions and escalate operational expenses. This friction demands a careful equilibrium between robust security and a seamless user experience. Emphasizing the financial impact of these risks, the Association of Certified Fraud Examiners estimated in 2024 that organizations lost 5% of their annual revenue due to occupational fraud. This statistic highlights the essential need for accurate detection mechanisms that protect revenue streams while ensuring operations remain uninterrupted.

Market Drivers

The incorporation of generative artificial intelligence into criminal tactics has greatly complicated cyberattacks, necessitating the deployment of advanced verification technologies. As fraudsters employ deepfakes and synthetic identity manipulation to circumvent standard security measures, there is a pressing requirement for behavioral analytics and liveness detection. This technological evolution fuels the adoption of platforms designed to spot AI-generated anomalies before they affect financial institutions. According to the 'Sumsub Identity Fraud Report 2024' published by Sumsub in November 2024, global deepfake incidents surged by 245% year-over-year, underscoring the rapid advancement of these threats and the resulting market need for sophisticated countermeasures.

Concurrently, the rapid increase in global digital payment volumes demands strong fraud prevention systems to secure the growing transaction ecosystem. As consumers increasingly use mobile wallets and real-time payment infrastructures, the vulnerability to financial crimes expands, resulting in significant monetary losses. Consequently, organizations are prioritizing real-time monitoring systems to stop unauthorized transactions without disrupting legitimate users. According to the Federal Trade Commission's 'Consumer Sentinel Network Data Book 2023' released in February 2024, consumers reported fraud losses exceeding $10 billion in 2023, setting a new record. To address this volume, major networks are utilizing vast resources; for instance, Visa reported in 2024 that it successfully prevented $40 billion in fraudulent activity the previous year, illustrating the massive scale of current prevention initiatives.

Market Challenges

Managing false positives remains a significant barrier to the expansion of the Global Fraud Detection and Prevention Market. This challenge causes considerable operational friction, requiring businesses to intervene frequently to prevent the unfair decline of legitimate customers. When detection systems act too aggressively, they produce high rejection rates for valid transactions, leading to immediate revenue loss and enduring harm to brand loyalty. As a result, organizations often hesitate to fully implement automated security solutions, fearing that the financial detriment of turning away good customers will exceed the benefits of fraud prevention, thereby slowing market adoption rates as companies struggle to justify investments that might impede the consumer journey.

The economic consequences of this lack of precision are both measurable and severe. According to the Merchant Risk Council, global merchants rejected approximately 6% of annual eCommerce orders in 2024 due to suspected fraud, with false positive rates often falling between 2% and 10%. This data highlights the scale of the issue; when valid orders are consistently blocked, the ensuing friction pushes consumers toward competitors. This dynamic compels enterprises to restrict their dependence on stringent detection technologies, which directly curbs the market's potential for growth.

Market Trends

The convergence of Fraud and AML (FRAML) operations is reshaping the market by breaking down traditional barriers between fraud detection and anti-money laundering compliance. Financial institutions are increasingly merging these functions to establish a comprehensive view of risk, enabling the simultaneous detection of complex financial crimes across both areas while optimizing resource use. This shift is driven by the necessity to eliminate redundant investigative work and lower operational costs tied to maintaining separate compliance teams. Demonstrating the economic efficiency of this approach, Hawk AI reported in April 2025 in 'Trends in Fraud & AML Convergence at US Mid-Market Banks & Credit Unions' that 77% of surveyed institutions anticipate saving over $1 million within the first five years of unifying their fraud and AML programs.

Mitigating Authorized Push Payment (APP) scams has become a key market focus, prompting vendors to create solutions that target social engineering rather than solely technical breaches. Unlike unauthorized fraud, APP scams involve manipulating victims into approving transfers, requiring intent-based detection systems and real-time psychological interventions during the payment process. This focus is growing due to regulatory updates that increasingly place liability for these losses on payment service providers, encouraging the use of advanced friction measures. According to UK Finance's 'Annual Fraud Report 2025' released in May 2025, the total volume of authorized push payment fraud cases fell by 20% in 2024, indicating the success of these targeted consumer protection strategies.

Key Players Profiled in the Fraud Detection and Prevention Market

• Iovation Inc.
• IBM Corporation
• Cardinal Commerce Corporation
• Oracle Corporation
• Experian PLC
• PayPal Holdings Inc.
• Distil Networks Inc.
• Hitachi, Ltd.
• NovAtel Inc.
• Comtech Telecommunications Corp.

Report Scope

In this report, the Global Fraud Detection and Prevention Market has been segmented into the following categories:

Fraud Detection and Prevention Market, by Component:

• Services
• Solutions

Fraud Detection and Prevention Market, by Solutions:

• Fraud Analytics
• Authentication
• Governance
• Risk
• Compliance

Fraud Detection and Prevention Market, by Application:

• Identity theft
• Money Laundering
• Payment Fraud
• Others

Fraud Detection and Prevention Market, by Industry Vertical:

• BFSI
• Real Estate
• Government
• Manufacturing
• IT & Telecom
• Energy & Utilities
• Telecommunications
• Retail
• Others

Fraud Detection and Prevention Market, by Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Fraud Detection and Prevention Market.

Available Customization

The analyst offers customization according to your specific needs. The following customization options are available for the report:

• Detailed analysis and profiling of additional market players (up to five).

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