Juniper Research: Online payment fraud detection spend to reach $9.3 billion by 2022
A new study from Juniper Research has found that spending on online FDP (fraud detection and prevention) solutions is set to rise to $9.3 billion by 2022, an increase of 22% over this year’s anticipated spend.
The research found that perceptions of high software costs alongside relatively low awareness of effective solutions in the eCommerce space were slowing service uptake. Nevertheless, it predicted that several factors would prove instrumental in driving the market forward.
Fraud automation & new services to drive spend
Juniper’s new research, Online Payment Fraud: Emerging Threats, Key Vertical Strategies & Market Forecasts 2017-2022 found that the growing threat of insecure IoT (Internet of Things) devices would be key in driving FDP spend. It cited the evolution of IoT botnets from DDoS (Distributed Denial-of-Service) weapons aimed at fraud automation tools as influencing this trend, owing to a requirement for better customer verification tools.
Meanwhile, Juniper predicted the launch of 3DS 2.0 (3-D Secure 2.0) would have a similar impact. It claimed 3DS 2.0 would both reduce fraud and result in fewer basket abandonments, if merchants invested in authentication solutions as part of an FDP strategy.
Finally, it cited the upcoming PSD2 (revised payment services directive) and the move to open banking APIs in Europe, North America and Asia as a further driver. “APIs expose a set of business logic rules, which by their nature are susceptible to abuse”, noted research author Steffen Sorrell. “This will drive banks and service providers to greater emphasis on protecting those APIs.”
Emerging markets remain vulnerable
Juniper predicted that emerging markets, such as Latin America, Indian Subcontinent and Africa & Middle East would become key targets for banking and payments fraud.
Collectively, these regions will account for only 4% of global FDP spend in 2022. The research noted that stronger regulation to protect consumers as well as better consumer education in safer online practices were key issues to address.
The whitepaper, Future Fraud: 3 Key Battlegrounds in 2018, is available to download from the Juniper website together with further details of the full research.
Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary.