As fraud threats continue to evolve, enterprises need robust solutions to protect their financial assets, reputation and customer trust. Recent research reveals that global losses from online payment fraud are projected to exceed $343 billion between 2023 and 2027.
With this figure in mind, selecting the right fraud management system is crucial for defending against increasingly sophisticated cyberattacks. Here, we’ll explore the ten best enterprise fraud management systems and provide practical guidance on choosing the one that best fits your organization’s needs.
List of Top Fraud Management Systems
What Is a Fraud Management System?
A fraud management system (FMS) is a comprehensive set of tools, technologies and processes designed to detect, prevent and mitigate fraudulent activities within an organization. These systems are typically used by businesses across various industries, especially those that deal with financial transactions, such as banks, ecommerce platforms, fintech companies and online service providers.
Key Features of a Fraud Management System
Components of a fraud management system deliver powerful tools to detect, prevent and respond to fraudulent activities in real time. These capabilities help businesses safeguard operations, protect customer data and maintain compliance while reducing financial risk. Key features include:
- Team management: Supports multiple logins with varied permissions for seamless team collaboration.
- Unified dashboard: Centralized interface for managing and sharing fraud prevention strategies across departments.
- Integration flexibility: Easily integrates with current systems and future tools, with solid API compatibility.
- Digital Footprint Analysis: Leverages digital and social signals to quickly validate user information, improving onboarding without compromising security.
- Dynamic Friction: Applies friction based on risk scores to streamline user experiences while screening for fraud.
- Customization: Offers flexible rule-setting and data handling to address specific fraud risks and adapt to new threats.
- Machine Learning: Automates rule adjustments and suggests new strategies for real-time fraud detection.
The 10 Best Fraud Management Systems
Disclaimer: Everything you’ll read in this article was gleaned from online research, including user reviews. We did not have time to manually test every tool. This article was last updated in Q3 2024. Please feel free to contact us to request an update/correction.
There are a range of solutions available with varying expertise and focuses to factor in when making a decision, along with other important variables such as integration, costs, and time. See below some other products on the market today.
SEON – Unique Digital Footprinting and Custom Rules
Provides comprehensive fraud management through real-time digital footprint analysis, device intelligence and advanced machine learning. Its unique approach leverages 90+ online sources to gauge user legitimacy, offering free and paid plans tailored to your business needs.
Summary of what SEON offers:
- Real-time digital footprint analysis
- Granular reporting and customizable risk rules
- Strong velocity checks for multi-accounting and fraud rings
As one of the most trusted AML and anti-fraud solutions on the market and a top-tier solution on G2, SEON is known for its precision, flexibility and affordable pricing options.
SEON offers a fully modular fraud solution and the support of a team of experts always at hand to support your business growth.
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Ekata
Ekata provides fraud prevention and identity verification products with graph and network visualization capabilities to help companies with handling masses amounts. Recently acquired by Mastercard, the company works with AliPay, Microsoft, Stripe, and Airbnb. They specialize in identity verification and fraud prevention, providing strong visualizations and graph analysis tools to streamline manual reviews. It excels in fraud detection during onboarding and account creation.
Kount
Kount holds data of over 32 billion annual interactions across 250 countries, 75+ industries, 50+ payment processors, and card networks. The company focuses on supporting retail companies with both offline and online presence. They are leading fraud management system for ecommerce, with expertise in reducing chargebacks and leveraging a vast data network to protect online and offline retailers.
Signifyd
Signifyd provides an end-to-end fraud prevention platform with a 100% chargeback protection model in place to increase automation and remove fraud liability for the merchant. They also offer integrations available across Salesforce, Shopify, and Magento.
The chargeback guarantee model can be a double-edged sword. On one hand, you can be sure you’ll never have to pay for more chargeback admin fees, which can be costly and time-consuming to manage. However, certain fraud managers prefer having more control over false positives to manage chargebacks based on their risk appetite.
TruValidate
Initially making a name for itself as Iovation, TruValidate is a device-based fraud prevention and multi-factor consumer authentication solution acquired by TransUnion in 2018. The company has a database with over 10 billion unique devices and 117 million recorded instances of fraud and abuse.
Offers device-based fraud detection with a massive database of unique devices. Initially popular in iGaming, it remains a strong choice for industries needing device-based security.
Sift
A former Y Combinator accelerator beneficiary, Sift offers a complete Digital Trust & Safety suite utilizing blackbox machine learning to streamline operations to remove the pressure on human resources. The firm’s main industries are fintech, retail, food, and beverage.
Delivers a robust fraud prevention platform with blackbox machine learning that automates operations, which is especially suited for fintech and retail. It’s known for resolving chargebacks and addressing cybersecurity concerns.
Feedzai
Feedzai offers modular solutions aimed at retail banks and financial institutions. Its real-time transaction scanning detects fraud, and its AML compliance support makes it a strong choice for fintech.
FraudHunt
FraudHunt was founded in 2013, its mission is to create a safe environment for online businesses, namely by detecting bots, triggering high-risk alerts, and fingerprinting devices for authentication.
SumSub
Launched as an identity verification solution in 2015, SumSub has grown into a KYC and IDV juggernaut. It also helps that the company offers compliance tools for KYC, AML – and even KYB, or Know Your Business.
Excels in identity verification, KYC, and AML compliance, offering video verification and case management tools to meet strict regulatory requirements.
SAS
SAS, which stands for Statistical Analysis System, is a legacy fraud prevention software that has been going since 1984. It offers a wide range of data analytics products, which have been adopted by a number of traditional financial institutions to manage risk and reduce fraud.
There is a handful of SAS products worth noting for fraud management, namely SAS Continous Monitoring for Procurement Integrity, SAS Detection and Investigation, and SAS Identity 360.
Choosing a Fraud Management System
When selecting a fraud management system, businesses should assess their unique needs, industry demands, and risks. Each platform has strengths, such as identity verification, real-time detection, or chargeback prevention. To ensure alignment with operational goals and adequate protection against evolving threats, consider the following:
- Analyze Business Requirements: Identify the types of fraud, channels, and products that need protection. Consider current and future transaction volumes and regulatory requirements. Documenting these factors ensures you choose a solution tailored to your needs, rather than a one-size-fits-all option.
- Evaluate Key Features: Prioritize key features like real-time detection, advanced analytics, machine learning, customizable rules, risk scoring, and case management. A user-friendly interface for analysts is also crucial for system effectiveness.
- Assess Scalability and Performance: It is vital that the chosen system can handle your current and projected transaction volumes. Scalability is key, as the system should be able to grow alongside your business. Additionally, ensure that the system can process data in real time to enable rapid fraud detection, which is essential for minimizing potential losses.
- Review Integration and Compatibility: Verify that the fraud management system can integrate smoothly with your existing technology stack. Look for solutions that support API integrations and SDKs for easier implementation. Compatibility with your current databases and data formats is also critical to ensure a seamless transition and operation.
- Consider Adaptability and Machine Learning: A robust fraud management system should leverage advanced machine learning to adapt to new and evolving fraud patterns over time. This capability allows the system to provide automated rule suggestions and optimizations, ultimately enhancing its effectiveness.
- Evaluate Vendor Expertise and Support: Request case studies and client testimonials to gauge vendor expertise. Ask about their fraud detection experience, trend awareness, implementation timelines, and ongoing support for smooth operation.
- Conduct Demos and Trials: Request product demos from shortlisted vendors and, if possible, conduct a trial to test the system in your environment. This hands-on approach helps ensure the solution meets your needs and protects against evolving fraud threats.
FAQ
Any company trying to reduce fraud rates such as chargeback fees, account takeover, or fake identities can use a fraud management system. There are many ways to deploy these tools, and their features and pricing vary greatly from one provider to the next.
Fraud management systems automatically allow or block certain user actions. They calculate how risky a signup, login, or transaction is based on preset rules. Some fraud management systems also focus on providing risk management teams with more data to make better decisions.
Managing fraud risks efficiently means that less fraud goes through. A reduction in fraud means an increase in revenue and much more, from happier staff to a smoother customer experience.
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Learn more about:
Browser Fingerprinting | Device Fingerprinting | Fraud Detection API | Fraud Detection and Prevention
Sources
- Fortune Business Insight: Global fraud detection and prevention market value
- Neil Patel: Customer Onboarding: Your Secret Sauce to Reducing SaaS Churn
- The Verge: Forty percent of ‘AI startups’ in Europe don’t actually use AI, claims report
- Juniper Research: Online Payment Fraud Losses to Exceed $343 Billion Globally Over the Next 5 Years
