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2019

Transaction Monitoring Software Market

Transaction Monitoring Software Market Size, Share, Competitive Landscape and Trend Analysis Report by Component, Deployment Model, Organization Size, Application Anti-Money Laundering, Customer Identity Management, Fraud Detection and Prevention and Compliance Management), Industry Vertical : Global Opportunity Analysis and Industry Forecast, 2019-2026

IC : Software and Services

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Author's: Pramod Borasi & Shadaab Khan | Onkar Sumant
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Transaction Monitoring Software Market Outlook - 2026

The global transaction monitoring software market size was valued at $7,957.14 million in 2018, and market forecast is projected to reach $25,419.40 million by 2026, growing at a CAGR of 15.70% from 2019 to 2026. Transaction monitoring is the process of administering, reviewing, and analyzing the transaction processed on an information system or on a business application. Transaction monitoring is used by the organization for efficiently and effectively managing different types of transaction of the customer. The primary goal of transaction monitoring is to identify high-risk activity, protect customer business, and maintain the banking relationship. 

Transaction Monitoring Software Market Infographics

The transaction monitoring software market trends include increase in digitization of payments and need for mitigating money laundering, managing KYC compliance, and CTF activities drive the growth of the market.

Transaction Monitoring Software Market
By Component
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Solution is projected as one of the most lucrative segments.

Surge in the need for identifying high-risk activities by using advance analytics and need for organizations to comply with stringent regulatory agreements fuel the growth of the market. However, lack of transaction monitoring and AML professionals and difficulties in managing cross-border and multi-jurisdictional AML-compliance hamper the growth of the market. Furthermore, integration of advance technology such AI, machine learning and big data and increase in the deployment of transaction monitoring system by SMEs are anticipated to provide lucrative opportunity for the market. 

Transaction Monitoring Software Market
By Deployment Mode
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On-Premise is projected as one of the most lucrative segments.

The BFSI segment is excepted garner significant global transaction monitoring software market share. The major factors driving the adoption of transaction monitoring in this sector include the adoption of this software by various banks and financial institutions for managing different types of risk such as money laundering terrorist financing, risk compliance of bank’s operations, foreign exchange risk, interest rate risk, and to monitor various suspicious transactions. However, the retail & manufacturing sector is expected to grow at a highest rate during the forecast period, owing to rise in trends of online shopping, which has led to the adoption of this software.  

Transaction Monitoring Software Market
By Enterprise Size
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Large Enterprise is projected as one of the most lucrative segments.

The report focuses on the growth prospects, restraints, and trends of the transaction monitoring market analysis. The study provides Porter’s five forces analysis to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the transaction monitoring market.

Transaction Monitoring Software Market
By Application
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Fraud Detection and Prevention is projected as one of the most lucrative segments.

Segment review

The global transaction monitoring software market is segmented into component, deployment mode, organization size, industry vertical, and region. In terms of component, it is bifurcated into software and services. In terms of deployment mode, the market is divided into on-premise and cloud. As per organization size, it is classified into large enterprises and small & medium enterprises. In terms of application, the market is categorized into anti-money laundering (AML), customer identity management, fraud detection and prevention (FDP) and compliance management. Based on industry vertical, it is classified into BFSI, government & defense, IT & telecom, retail, healthcare, energy & utilities, manufacturing, and others. Region-wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Transaction Monitoring Software Market
By Industry Vertical
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BFSI is projected as one of the most significant segments.

The key players profiled in the transaction monitoring software market analysis are ACI Worldwide Inc., BAE Systems, Fair Isaac Corporation, Fiserv Inc., FIS, Nice Ltd., Oracle Corporation, SAS Institute, Software AG, and Thomson Reuters Corporation.

Transaction Monitoring Software Market
By Region
2026
North America 
Europe
Asia-Pacific
LAMEA

Asia-Pacific would exhibit the highest CAGR of 17.50% during 2019-2026.

Top Impacting Factors

Increase in the digitization of payment transactions

Significant increase of online transactions has been recorded in the recent years, supported by several government initiatives. For instance, according to a study conducted by BNP Paribas, digital payments are expected to reach 726 billion by 2020, which will drive cashless transactions in the future. For instance, according to a survey the number of cash transaction in total consumer spending in the country has come down from 78% in 2015 to 68% in 2017 in India. Such rise in online transaction has reduced the fraudulent transaction and money laundering issues and helps the bank to significantly monitor the transaction of the consumers. As a result, there is an increase in digitization of payment transactions and reduction in fraudulent activities. This in turn fosters the market growth.

Lack of transaction monitoring and AML professionals

The major challenge faced by financial industry is shortage of skilled professionals, due to the lack of different skill set of transaction monitoring such as in-depth knowledge of AML monitoring and others by individuals. The increase in demand for AML monitoring and transaction monitoring requires several highly advanced skills and with current scenario, its talent pool is relatively small, which limits its applications and restricts the growth of the transaction monitoring software market.

Increase in the deployment of transaction monitoring system by SMEs

SMEs are mainly considered as the highest risk sector by the banking and other financial institutions because they are commonly used as a shell industry for different financial crime and money laundering. Thus, increase in the adoption of advance technology such as artificial intelligence, big data analytics, and machine learning have been adopted by different SMEs for having adequacies and reducing the fraudulent in its transaction monitoring system. In addition, AI-based transaction monitoring helps the SMEs to proactively monitor the suspicious data and comply with various strict government regulations. All these factors significantly contribute toward the growth of the global transaction monitoring market.

Key Benefits for Transaction Monitoring Software Market:

  • The study provides an in-depth analysis of the global transaction monitoring software market forecast along with the current & future trends to elucidate the imminent investment pockets.
  • Information about key drivers, restrains, and opportunities and their impact analysis on the market size is provided in the report.
  • Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the industry.
  • The quantitative analysis of the global transaction monitoring software market from 2018 to 2026 is provided to determine the market potential.

Transaction Monitoring Software Market Report Highlights

Aspects Details
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By Component
  • Solution
  • Service
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By Deployment Mode
  • On-premise
  • Cloud-Based
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By Enterprise Size
  • Large Enterprises
  • Small & Medium Enterprises
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By Application
  • Anti-Money Laundering
  • Customer identity management
  • Fraud detection and prevention
  • Compliance Management
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By Industry Vertical
  • BFSI
  • Government & Defense
  • IT & Telecom
  • Retail
  • Healthcare
  • Energy & Utilities
  • Manufacturing
  • Other
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By Region
  • North America  (U.S., Canada)
  • Europe  (Germany, France, UK, Rest of Europe)
  • Asia-Pacific  (Japan, China, India, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
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Key Market Players

Oracle Corporation, SAS Institute Inc., FIS, Fiserv, Inc., Software AG, Fair Isaac Corporation, Thomson Reuters Corporation, Nice Ltd., ACI Worldwide, Inc., BAE Systems

Analyst Review

The adoption of transaction monitoring solutions has increased over time to deliver enterprises a better transaction monitoring strategy as it is widely recognized as a success factor for various financial institutions. Furthermore, the ability of the software to identify and prevent different threats has increased the adoption of transaction monitoring software among the end users. The adoption of transaction monitoring solution is expected to increase in the upcoming years as number of financial institutions and banks are adopting this software for many security reasons and for preventing various financial frauds. Increase in the need for mitigating money laundering, managing KYC compliance & CTF activities, and surge in the need for identifying high-risk activities by using advance analytics fuel the growth of the market. However, lack of transaction monitoring and AML professionals and difficulties in managing cross-border and multi-jurisdictional AML-compliance hamper the growth of the market. 

The global transaction monitoring software market has a very competitive and fragmented environment consisting of several international and regional players. 

Market players are adopting various business strategies to enhance their product offerings, product development, and increase their market penetration. For instance, in April 2019, BAE Systems has launched the latest version of NetReveal which uses human expertise and advanced analytics to effectively combat financial crime and fraud in different environment which are changing financial crime patterns and rapidly evolving regulatory requirements.

Author Name(s) : Pramod Borasi & Shadaab Khan | Onkar Sumant

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Transaction Monitoring Software Market

Global Opportunity Analysis and Industry Forecast, 2019-2026