COVID-19 Impact on Fraud Detection and Prevention (FDP) Market

The COVID-19 impact on the global Fraud Detection and Prevention (FDP) market size is projected to grow from USD 23.4 billion in 2019 to USD 38.6 billion by 2021, at a Compound Annual Growth Rate (CAGR) of 28.4% during the forecast period, considering the optimistic scenario. The market growth can be attributed to increased risks from remote access, growing use of electronic transaction amidst pandemic crises, and the rising revenue losses due to fraudulent activities.

Payment card frauds segment projected to grow at a higher CAGR over the forecast period.

Credit card or debit card frauds are a type of theft, which involves conducting fraud using a customer’s payment card, such as credit card or debit card, to obtain goods without paying or to obtain unauthorized funds from the compromised account. Rising e-commerce transactions and the increasing fraudulent attacks to steal card-related information and unauthorized purchase of goods are driving the demand for FDP solutions.

Healthcare segment projected to attain the highest growth rate during the forecast period.

COVID-19 poses an occupational health risk to healthcare workers; thousands of healthcare workers worldwide have been infected by COVID-19. Hence, preventing intra-hospital transmission of this communicable disease is a key priority for healthcare institutions and administrative bodies. The strategies and measures are based on the Systems Engineering Initiative for Patient Safety (SEIPS) model and are widely adopted to ensure occupational safety for healthcare professionals in hospitals. In general, the goal for all healthcare systems is to achieve the principle of zero occupational infection. According to NEMEXIS, a Berlin-based international anti-fraud consulting firm found that fraud and corruption are on the rise in healthcare and healthcare systems. The company surveyed almost 58 countries in its survey, which focused on issues such as fraud involving PPE and ventilators, the existence of black markets and faulty equipment, cyber-attacks on healthcare systems, the embezzlement of healthcare funds, and bribes taken by medical personnel. Out of which 80% supported the impact of fraud and corruption on their country’s healthcare system to be important

North America projected to account for the largest market share during the forecast period

North America is expected to maintain the largest share in the global fraud detection and prevention market. At the same time, Asia Pacific (APAC) is projected to grow at the highest CAGR during the forecast period. The high growth rate in Asia Pacific can be attributed to organizations in the region, grabbing opportunities to go beyond ensuring their regulations and compliances and applying technology to curtail threats on enterprise devices. The government organizations across countries in Asia have published guidelines for protection from cybercrimes and fraudulent activities. The Cyberspace Administration of China (CAC) on the 9th of February published a notice emphasizing rules and regulations on data privacy and big data analysis, including China’s Cybersecurity Law, which includes rules on personal information protection.

North America is the most significant revenue contributor to the global fraud detection and prevention market. As the COVID-19 pandemic continues to impact North America, fraudsters have seized the opportunity to prey on consumers. According to the Federal Trade Commission (FTC), Americans have lost USD 13.4 million to coronavirus-related fraud since the beginning of the year. The top fraud categories for COVID-19 scams are related to travel and vacations, online shopping, bogus text messages, and imposter scams. Multiple federal agencies are working together to analyze the complaints, investigate ongoing fraud, phishing, or malware schemes, and assemble vetted referrals.

Key Market Players

Major vendors in the global FDP market include IBM (US), FICO (US), SAS Institute (US), BAE Systems (UK), DXC Technology (US), SAP (Germany), ACI Worldwide (US), Fiserv (US), NICE Systems (Israel), Experian (US), LexisNexis Risk Solutions (US), TransUnion (US), FRISS (Netherlands), Dell Technologies (US), Wirecard (Germany), Software AG (Germany), Easy Solutions (US), Hitachi Vantara (US), Kount(US), and Simility (US). These vendors have adopted various organic and inorganic growth strategies, such as new product launches, partnerships and collaborations, and mergers and acquisitions, to strengthen their presence in the FDP market.

SAP has contributed USD 3.2 million to the COVID-19 Emergency Fund to support the urgent needs of the WHO, the CDC Foundation, and smaller nonprofit organizations and social enterprises that work on the front lines serving local communities in crisis. Similarly, Dell Technologies has donated USD 284,000 to provide surgical masks, protective clothing, and eye protectors in local hospitals within China.

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Scope of the Report

The research report categorizes the impact of COVID-19 on the FDP market based on fraud type, vertical, and region.

On the basis of fraud type, the FDP market has the following segments:

• Check fraud
• Identity fraud
• Internet sales fraud
• Investment fraud
• Payment card fraud
• Others (Insurance fraud, Work-from-home fraud, and Charity fraud)

On the basis of vertical, the FDP market has the following segments:

• Banking, financial services, and insurance (BFSI)
• Retail and e-Commerce
• Healthcare
• Manufacturing
• Government and the public sector
• Travel and transportation
• Others (Telecommunication, energy and power, and media and entertainment)

On the basis of region, the FDP market has the following segments:

• North America
• Europe
• Asia Pacific (APAC)
• Middle East and Africa (MEA)
• Latin America

Recent Developments

• In March 2020, IBM partnered with The White House and the US Department of Energy have created a consortium to bring together the best supercomputers. This partnership would help researchers run large numbers of calculations in epidemiology, bioinformatics, and molecular modeling.
• In March 2020, JR Automation, a wholly-owned subsidiary of Hitachi, Ltd., partnered with General Motors (GM) to help produce face masks to combat the COVID-19 outbreak.
• In March 2020, DXC Technology partnered with Tradeshift to leverage its expertise in AI, ML, and robotic process automation platform and to benefit customers from the emerging technology and accelerate digital transformation.

Key questions addressed by the report

• What are the COVID-19 crisis-driven growth opportunities in the fraud detection and prevention market?
• Which types of frauds are impacted the most due to the COVID-19 crisis?
• How are key vendors responding to the crisis and devising their short-term strategies?
• What are the COVID-19 driven dynamics impacting the fraud detection and prevention market?
• Which verticals are deploying fraud detection and prevention solutions at scale to address COVID-19 specific use cases?

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