Fraud Prevention Systems Market Intelligence

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Are you looking for answers on Fraud Prevention Systems category?

Are you looking for answers on Fraud Prevention Systems category?

  • What are the key trends in Fraud Prevention Systems category?
  • Am I paying the right price?
  • Am I working with the right supplier?
  • What are the major challenges and risks in Fraud Prevention Systems industry?
  • How is Fraud Prevention Systems industry performing?

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Report Coverage

  • Market Trends
  • Technology & Innovation Trends
  • Global Supplier List and Capabilities
  • Mergers and Acquisitions

Table of contents

  1. Fraud Prevention Systems Summary
  2. Global Fraud Prevention Systems Market
  3. Supply Market & Adoption Outlook
  1. Fraud Prevention Systems Pricing Model(s)/Metrics
  2. Pricing Metrics Analysis
  1. Fraud Prevention Systems Market Analysis
  2. Retail Banking Fraud - Market Overview
  3. Global Financial Fraud Trends
  4. Global Market Maturity
  5. Drivers and Constraints
  6. Porter’s FiveForces Analysis
  1. Fraud Prevention Systems Supplier Analysis
  2. Supply Market Outlook
  3. Fraud Prevention System - Capability Study
  4. Supplier Capability Mapping
  5. Supplier Profiling & SWOT
  1. Appendix
  2. Glossary
  3. High Level Architecture Diagrams
  4. Expert Profile

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Retail Banking Fraud - Market Overview

  • Retail banking fraud encompasses Application level fraud and transactional level fraud
  • Application fraud comprises fraud committed at the application stage across account opening, and secured and unsecured credit product applications whereas transactional fraud refers to that occurring during transactions such as account takeover and payments
  • While technologies in POS like EMV (chip, tokenization and encryption) have decreased transactional fraud losses, application fraud is still a major issue in the banking space
  • Though there are many players in the fraud detection software space, the supplier base is still low for retail banking due to greater regulation and requirement of access to consortium data (across other financial institutions including banks) in the fraud prevention system industry.
  • Threat of substitution is low as there are only few players within the financial fraud prevention systems space catering to the retail banking industry.
  • In countries like the UK where large syndicated databases form a primary part of the fraud prevention system ecosystem.
  • Fraud prevention trends show that with an exponential growth in data from different channels such as mobile, email, ATM, etc., there is a need to develop effective early warning system using analytical predictor solutions that take a holistic approach towards identifying suspicious customer applications beforehand.
  • While most fraud prevention system software providers focus on transactional fraud, there are only few suppliers who operate in the customer application fraud space for retail banking.
  • Despite the low supplier base, intensity of rivalry is low as most suppliers offer flexible modular solutions that can be integrated across competitor solutions.
  • With multiple application channels buoyed by the increasing preference for digital channels, it is essential for banks to monitor for identity not only at the application level but also throughout the customer lifecycle. Hence, the need for device intelligence systems that track web, e-mail and digital interaction behavior to derive abnormal pattern.

fraud-prevention-systems-market-size

Global Financial Fraud Trends

  • New-account fraud rose 70 percent in 2017,with account takrover fraud in the US growing three times over 2016,to reach a total loss of $55.1 billion
  • Identity theft is a major component of new-account fraud where good credentials are used as facilitators for committing application fraud E.g., Social security number breach accounted for 500,000 fraud victims in 2014 and is expected to rise to 710,000 by 2018
  • Identify Fraud number/victims reached 16.7 million in the US in 2017,an increase of 8 percentage over the previous year.ID fraud constitutes to 6.64 percent of consumers
  • Total value netted by fraudsters was estimated at $16.8 billion in the US

  • With regard to online fraud, CNP fraud accounted for 81 percent against POS fraud

Retail Banking Fraud Prevention Systems - Global Market Maturity

  • While there are many players offering analytics based financial fraud detection software, there are only few players catering to the retail banking space. This is a direct consequence of regional/national regulations. Hence, the maturity is closely tied with the banking landscape
  • While emerging economies still lag developed countries in terms of fraud technology adoption, they have the opportunity of leapfrogging into adopting advanced fraud detection software across the enterprise. (Its peers in the developed world face challenges integrating its legacy systems)

Supply Trends and Insights

Global/Regional Supplier

  • Reactive to predictive analytics: Advanced analytics techniques based on machine learning such as neural networks and self organizing maps are being used to identify fraud patterns and vulnerable customer applications. This in turn provide fraud scores for customer applications indicating proximity to a benchmark fraud characteristic
  • Big data: With the explosion in volume, variety and velocity of data, fraud prevention systems are gearing towards capabilities that enable digestion and monitoring of customer information across his/her entire lifecycle. E.g., looking at buying patterns to discern any unlikely/deviant purchase behavior in comparison with historic purchase behavior. These services are mostly provided as a bespoke managed service post license purchase
  • Device intelligence to digital footprint: Apart from device intelligence services encompassing channels such as mobile, e-mail, IP, etc., there is also a need to look at synthetic identities where there are sudden spikes in credit requests from a seemingly authenticated source

Vertical/Local Supplier

  • Vertical focused solutions:While there are few suppliers focussed on the retail banking vertical due to the need for dynamic regulatory systems, there are information sharing agreements through databases at the national level that contain cross-member (financial institutions and insurance) application data that help in screening for fraud at the application stage E.g., CIFAS, Hunter, SIRA in the UK, IFI in the Netherlands,FPN in Germany
  • These fraud databases are also sometimes combined with data from other industries such as telecom data E.g., Fraud prevention pool in Germany

Engagement Trends

  • Most adopted engagement model globally: Single vendor with a bespoke service
  • Licensing metrics: The most widely used metric is volume of applications/number of submissions into the system. Some suppliers also use ‘pay per click' where in the initial submission and any updates or re-checks are counted separately
  • Additional services such as integration to external consortium data through adaptors or APIs are charged as a separate fee. E.g., FICO Falcon Fraud Manager integrating with Hunter database

Why You Should Buy This Report

  • The report gives insight into the fraud preventions systems market size, fraud prevention trends, drivers and constraints, etc.
  • It gives the Porter’s five force analysis of the global fraud prevention system market.
  • It gives insight into supply trends and gives profiles and SWOT analysis of major players like Experian, TransUnion, Equifax, etc.
  • The report gives the pricing metrics analysis of the fraud preventions systems market.

Fraud Prevention Systems Market Frequently Asked Questions

  1. What was the estimated cost of fraudulent customer applications in 2016?
  2. According to Beroe’s global fraud detection and prevention market analysis, the cost of fraudulent customer applications was estimated at $28.6 billion by the end of 2016.
  1. What are the major fraud types?
  2. The major fraud types can be categorized as identity theft, account takeover fraud, bust out fraud (synthetic IDs), and third-party fraud. What are the major KPIs in fraud prevention software? The major KPIs in fraud prevention software are mentioned as follows. · Database validation for fraud screening · Advanced analytics · Real-time service · Device Intelligence · Geo-fraud detection
  1. Which regions mark high maturity and low maturity in the global fraud detection and prevention market?
  2. North America and Europe are the high market maturity regions, while APAC and the Middle East are medium market maturity regions.
  1. Who are the key players in the retail banking fraud prevention systems space?
  2. The top fraud prevention solution providers for retail banking are Equifax, Experian, FICO, TransUnion, Scorto, Fiserv, and FIS.
  1. What are the key drivers of the global fraud detection and prevention market?
  2. Analytics and building of predictor tools, device intelligence, geo-fraud, and syndicated checklists are the key factors driving the global fraud detection and prevention market.
  1. Are there any constraints that the fraud prevention system market is facing?
  2. The fraud prevention system market faces constraints from synthetic identities, false positives, and customer response times.
  1. Who are the niche suppliers in the fraud detection and prevention market?
  2. As per Beroe’s fraud detection and prevention market analysis, the niche suppliers are CoreLogic – Mortgage Fraud Management and Banker’s Toolbox – Payments Fraud including Wire Fraud.
  1. What is the global market maturity scenario with regards to the retail banking fraud prevention systems?
  2. Due to the regional and national regulations, only a few players are catering to the retail banking space although many players are offering analytics-based financial fraud detection software. This explains why global market maturity is closely tied to the banking landscape.
  1. What options do the emerging economies who lag in fraud technology adoption have?
  2. Emerging economies lagging in terms of fraud technology adoption have the opportunity to leapfrog into adopting advanced fraud detection software across enterprises.
  1. What are the key takeaways from the global financial fraud detection and prevention market trends?
  2. Here are the key takeaways from the global financial fraud detection and prevention market trends. · 2017 saw a 70 percent increase in the new-account fraud reaching a total loss of $55.1 billion. · In 2014, there were about 500,000 fraud victims from social security number breaches. · Identity Fraud victims reached 16.7 million in the US in 2017. · Fraudsters netted a total value of $16.8 billion in the US.

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