Fraud Detection and Prevention Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Component (Services, Solutions), By Solutions (Fraud Analytics, Authentication, Governance, Risk and Compliance), By Application (Identity theft, Money Laundering, Payment Fraud, Others), By Industry Vertical (BFSI, Real Estate, Government, Manufacturing, IT & Telecom, Energy & Utilities, Telecommunications, Retail, Others), By Region, Competition 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 38.73 Billion
CAGR (2026-2031)	18.36%
Fastest Growing Segment	Solutions
Largest Market	North America
Market Size (2031)	USD 106.48 Billion

Market Overview

The Global Fraud Detection and Prevention Market will grow from USD 38.73 Billion in 2025 to USD 106.48 Billion by 2031 at a 18.36% CAGR. The Global Fraud Detection and Prevention Market comprises analytical solutions and services designed to identify and mitigate illicit activities across financial and commercial sectors. Key drivers supporting market growth include the rising volume of digital payments demanding real-time monitoring and rigorous regulatory mandates such as Anti-Money Laundering (AML) compliance. Additionally, the imperative to minimize direct financial liabilities and protect brand reputation compels enterprises to adopt these security measures, distinct from the technological trends influencing the industry.

A significant challenge impeding expansion is the management of false positives, which disrupt legitimate customer interactions and increase operational costs. This friction necessitates a delicate balance between security and user experience. Highlighting the financial severity of these risks, according to the Association of Certified Fraud Examiners, in 2024, organizations were estimated to lose 5% of their annual revenue to occupational fraud. This data underscores the critical need for precise detection tools that safeguard revenue while maintaining seamless operations.

Key Market Drivers

The integration of generative artificial intelligence into criminal methodologies has significantly increased the complexity of cyberattacks, compelling the market to deploy enhanced verification technologies. Fraudsters utilize deepfakes and synthetic identity manipulation to bypass traditional security protocols, creating an urgent need for behavioral analytics and liveness detection. This technological shift drives the adoption of platforms capable of identifying AI-generated anomalies before they impact financial institutions. According to Sumsub, November 2024, in the 'Sumsub Identity Fraud Report 2024', the number of deepfake incidents detected globally increased by 245% year-over-year, highlighting the rapid evolution of these threats and the corresponding market demand for advanced countermeasures.

Simultaneously, the exponential growth in global digital payment volumes necessitates robust fraud prevention mechanisms to protect the expanding transaction ecosystem. As consumers migrate toward mobile wallets and real-time payment infrastructures, the attack surface for financial crimes widens, leading to substantial monetary losses. Organizations prioritize the deployment of real-time monitoring systems to intercept unauthorized transactions without creating friction for legitimate users. According to the Federal Trade Commission, February 2024, in the 'Consumer Sentinel Network Data Book 2023', consumers reported losing more than $10 billion to fraud in 2023, marking a historic high. To combat this volume, large networks are deploying immense resources; according to Visa, in 2024, the company successfully blocked $40 billion in fraudulent activity during the previous year, demonstrating the critical scale of current prevention efforts.

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Key Market Challenges

The management of false positives presents a substantial impediment to the growth of the Global Fraud Detection and Prevention Market. This issue creates significant operational friction, as businesses must frequently intervene to ensure legitimate customers are not unfairly declined. When detection systems are overly aggressive, they generate high rejection rates for valid transactions, causing immediate revenue loss and long-term damage to brand loyalty. Consequently, organizations often hesitate to implement or fully utilize automated security solutions, fearing that the financial damage from rejecting good customers will outweigh the savings from preventing fraud. This reluctance slows market adoption rates, as companies struggle to justify investments in tools that might disrupt the consumer journey.

The economic impact of this imprecision is measurable and severe. According to the Merchant Risk Council, in 2024, global merchants rejected an estimated 6% of annual eCommerce orders due to fraud suspicion, with false positive rates frequently ranging between 2% and 10%. This data illustrates the magnitude of the problem; when valid orders are routinely blocked, the resulting friction drives consumers to competitors. This dynamic forces enterprises to limit their reliance on strict detection technologies, directly constraining the market’s expansion potential.

Key Market Trends

The Convergence of Fraud and AML (FRAML) Operations is fundamentally restructuring the market by dismantling the traditional silos between fraud detection and anti-money laundering compliance. Financial institutions are increasingly integrating these functions to create a holistic view of risk, allowing for the simultaneous detection of complex financial crimes that span both domains while optimizing resource allocation. This organizational shift is driven by the need to reduce redundant investigation efforts and operational costs associated with maintaining separate compliance teams. Highlighting the economic efficiency of this model, according to Hawk AI, April 2025, in the 'Trends in Fraud & AML Convergence at US Mid-Market Banks & Credit Unions' report, 77% of surveyed financial institutions expect to save over $1 million within the first five years of converging their fraud and AML programs.

Prioritizing Authorized Push Payment (APP) Scam Mitigation has emerged as a distinct market force, compelling vendors to develop solutions that address social engineering rather than just technical hacks. Unlike unauthorized fraud, APP scams involve manipulating victims into consenting to transfers, which necessitates intent-based detection systems and real-time psychological interventions during the payment journey. This focus is intensifying due to regulatory changes that increasingly shift liability for these losses onto payment service providers, incentivizing the deployment of advanced friction measures. According to UK Finance, May 2025, in the 'Annual Fraud Report 2025', the total volume of authorized push payment fraud cases decreased by 20% during 2024, reflecting the successful implementation of these targeted consumer protection strategies.

Segmental Insights

The Solutions segment is currently emerging as the fastest-growing category within the Global Fraud Detection and Prevention Market. This rapid expansion is primarily driven by the escalating volume of digital transactions and the critical necessity for real-time threat identification across financial platforms. Organizations are increasingly adopting automated software integrated with artificial intelligence and machine learning to combat complex cyber risks effectively. Furthermore, stringent compliance mandates from institutions such as the European Banking Authority compel enterprises to invest heavily in scalable analytical tools, prioritizing automated defenses over manual intervention methods.

Regional Insights

North America currently holds the leading position in the global fraud detection and prevention market due to the widespread adoption of digital payment methods and the high concentration of key technology providers. The dominance of this region is driven by the increasing volume of fraudulent activities which compels enterprises to invest in security solutions. Furthermore, strict compliance mandates enforced by regulatory bodies such as the Federal Trade Commission require organizations to implement rigorous defense mechanisms. The established financial infrastructure and early integration of risk management technologies within the banking sector further support this market expansion.

Recent Developments

• In April 2024, Cognizant entered into a strategic collaboration with FICO to launch a cloud-based real-time payment fraud prevention solution. This joint offering integrated Cognizant’s communication layer and clearing gateway with the FICO Falcon Fraud Manager to provide North American banks and payment service providers with enhanced security for instant digital payments. The partnership focused on leveraging artificial intelligence and machine learning technologies to detect and block fraudulent transactions with high precision. This solution was specifically engineered to address the growing risks associated with real-time payment rails, ensuring a secure and seamless experience for customers using services like FedNow.
• In April 2024, Mastercard unveiled "Scam Protect," a comprehensive suite of specialized solutions powered by artificial intelligence to identify and prevent various types of financial scams. The company combined its identity, biometric, and open banking capabilities to protect consumers from threats ranging from card-based fraud to complex account takeovers. As part of this initiative, Mastercard also established a strategic partnership with Verizon to collaborate on advanced tools that utilize network technologies to block scammers across multiple channels. This holistic approach aimed to combat the increasing sophistication of digital deception and foster greater trust in the digital ecosystem.
• In March 2024, Visa announced the significant expansion of its fraud prevention portfolio with the launch of three new AI-powered solutions under the Visa Protect suite. These innovative tools were designed to combat fraud across immediate account-to-account and card-not-present payments, extending security measures to transactions occurring both on and off the company's network. The release included Visa Deep Authorization, a transaction risk scoring solution, and an enhanced version of Visa Advanced Authorization for non-Visa cards. This development aimed to help issuers and merchants utilize deep learning models to detect and block fraudulent activities in real-time, thereby reducing operational costs.
• In February 2024, Feedzai announced a strategic partnership with UK Finance to serve as the lead sponsor and data contributor for the organization's Annual Fraud Report. This collaboration involved utilizing Feedzai’s artificial intelligence capabilities to analyze data from major banking and financial services members, providing a comprehensive view of the fraud landscape. The initiative aimed to identify key fraud trends, such as authorized push payment scams, and to highlight the challenges facing the finance industry. By leveraging shared intelligence and advanced analytics, the partnership sought to equip financial institutions with the insights needed to better protect consumers from evolving financial crimes.

Key Market Players

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

By Component	By Solutions	By Application	By Industry Vertical	By Region
Services Solutions	Fraud Analytics Authentication Governance Risk and Compliance	Identity theft Money Laundering Payment Fraud Others	BFSI Real Estate Government Manufacturing IT & Telecom Energy & Utilities Telecommunications Retail Others	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Fraud Detection and Prevention Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Fraud Detection and Prevention Market, By Component:

• Services
• Solutions

• Fraud Detection and Prevention Market, By Solutions:

• Fraud Analytics
• Authentication
• Governance
• Risk and 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
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE