While mobile-based payment applications, such as Paytm, Apple Pay, Google Pay, and PayPal, among others, gained traction in line with the rising number of smartphone users, these applications also emerged as the major targets of fraudsters, thereby prompting banks to offer online banking services and payment services companies to opt for fraud detection and prevention solutions to counter fraudsters’ intrusion threats and save the users from monetary losses.

The outbreak of the Covid-19 pandemic in 2020 originally triggered a rapid adoption of mobile banking services as banking service users prefer to avoid travel and human contact within bank premises. MX, a digital transformation platform for credit unions, banks, and fintech, revealed new research findings related to consumer spending and mobile banking adoption amid the economic uncertainty stemming from the Covid-19 pandemic. The data released in April 2020 already revealed a 50% increase in mobile banking engagement to control finances and plan the individual economic future.

While the adoption of mobile banking is rising significantly, mobile banking is also getting potentially vulnerable to fraudulent activities, such as account takeovers, carrier data breaches, call center fraud, subscription fraud, and phishing, among others, thereby driving the demand for fraud detection and prevention solutions over the forecast period.

Increasing use of Generative AI by cyber criminals

Organisations across BFSI, retail, healthcare, telecom, and government sectors are increasingly investing in AI-driven fraud analytics platforms to combat sophisticated cyber threats and financial fraud. The growing adoption of cloud-based fraud prevention solutions, coupled with stricter regulatory compliance requirements such as AML, KYC, PSD2, and GDPR, is further accelerating market growth. One of the most significant trends shaping the market is the increasing use of Generative AI and deepfake technologies by cyber criminals. Fraudsters are leveraging AI-powered phishing, synthetic identities, voice cloning, and fake document generation to bypass traditional security systems across both the broader fraud detection and prevention industry and the online fraud detection market. Industry reports indicate that more than 50% of modern fraud incidents now involve AI-enabled manipulation, forcing enterprises to deploy advanced behavioral analytics, biometric authentication, and real-time anomaly-detection solutions.

Some of the report highlights include:

• The solution segment led the market with the largest revenue share of 63.1% in 2025, primarily due to the rising need for advanced, real-time, and automated tools that can effectively identify and mitigate increasingly sophisticated fraud threats across digital channels.

• The payment fraud segment accounted for the largest market revenue share in 2025, driven by the exponential rise in digital payment transactions across online banking, e-commerce platforms, and real-time payment systems.

• The large enterprises segment accounted for the largest market revenue share in 2025, primarily due to their extensive digital infrastructure, high transaction volumes, and greater exposure to sophisticated cyber threats and financial fraud.

• The BFSI segment accounted for the largest market revenue share in 2025, primarily due to the sector’s high exposure to financial crimes, large transaction volumes, and stringent regulatory compliance requirements.

• North America dominated the global fraud detection and prevention market with the largest revenue share of 39.0% in 2025, primarily driven by the strong presence of advanced financial infrastructure, early adoption of AI/ML-based fraud detection technologies, and high transaction volumes across digital banking, fintech, and e-commerce platforms.