Fraud detection software is used to detect illegitimate and high-risk transactions made online. These tools continuously monitor user behaviors and calculate risk figures to identify potentially fraudulent purchases, transactions, or access. These tools are used by e-commerce businesses and digital banking companies IT and compliance departments to constantly monitor for potential fraudulent actions made by their users. Workers in the IT and Companies choose to adopt these tools to ensure transactions are legitimate while protecting sensitive information for both business and customers.
There is some overlap between fraud detection solutions and fraud protection software. But those tools are more geared toward enforcing regulations and analyzing purchasing behavior, rather than monitoring, detecting, and alerting incidents of fraud as they happen.
To qualify for inclusion in the Fraud Detection category, a product must:
- Proactively monitor for possible fraudulent or high-risk activity
- Calculate transactional risk scores to determine legitimacy
- Detect illegitimate transactional behaviors online
- Provide alerts and analysis tools for administrators
- Ensure compliance with data privacy and security regulations