REDDING, Calif., June 23, 2021 /PRNewswire/ -- According to a new market research report "Risk Analytics Marketby Component (Software, Services), Risk Type (Strategic, Operational, Financial), Deployment Mode, Industry Size, and End User (BFSI, Manufacturing, IT & Telecom, Retail, Transportation, Government, Healthcare) -Global Forecast to 2028", published by Meticulous Research®, the Risk Analytics Market is expected to reach $68.8 billion by 2028, at a CAGR of 13.4% during the forecast period of 2021 to 2028.
Risk analytics is an emerging form of data analytics that focuses on forecasting future risks for organizations. It helps take the guesswork out of managing risk-related issues by using various techniques and technologies to extrapolate insights, calculate likely scenarios, and predict future events. Risk analytics and associated technologies provide superior risk evaluation and risk migration capabilities compared to traditional analytics methodologies. Risk analytics and risk management techniques have been evolving and are becoming a standard tool for reducing business complexities. The technology allows deriving insights from complex business processes, making it an indispensable tool for modern-day businesses.
The increasing adoption of cloud computing and IoT technologies has resulted in the evolution of business needs in terms of agility. Subsequently, AI technology and cloud-based services have also gained significant traction in the past few years. Risk analytics has emerged as one of the essential tools for organizations to address issues associated with risk management and assessment. Due to the rising need for AI-based risk analytics models and growing data and security breaches, the demand for risk analytics solutions and services is expected to increase substantially over the coming years, thereby contributing to the market's growth.
However, dynamic regulatory policies, the high cost and complexity of implementing risk analytics software, and a lack of knowledge regarding risk analytics solutions pose challenges for the adoption of risk analytics solutions, especially in developing countries, thereby restraining the growth of this market to some extent.
Based on component, the risk analytics market is broadly segmented into software (risk calculation engines, dashboard analytics and risk reporting tools, GRC, credit risk analytics, and other risk analytics software) and services (professional services and managed services). In 2021, the software segment is expected to account for the larger share of the overall risk analytics market. The large share of this segment is mainly attributed to the rising digitization and business process automation, growing data and security breaches, growing data silos across businesses, and rising investments in R&D activities. However, the services segment is expected to grow at the higher CAGR over the forecast period due to the growing demand for risk analytics services among small and medium-sized enterprises and the rising need to improve business processes and optimize business infrastructure. Besides, the demand for support & maintenance services is expected to grow over the forecast period due to the consistent incorporation of risk analytics among organizations.
Based on risk type, the risk analytics market is segmented into financial risks, operational risks, third-party risks, and strategic risks. In 2021, the financial risks segment is expected to account for the largest share of the overall risk analytics market. The large share of this segment is mainly attributed to the constantly evolving threats in the financial sector, the rising instances of fraud, the increasing use of electronic transactions across all verticals, and the growing sophistication of cyberattacks. However, the operational risks segment is expected to grow at the highest CAGR over the forecast period. The rapid growth of the segment is attributed to the growing need for operational refinement among organizations and the growing pressure of resource and time optimization, and the associated risks.
Based on deployment, the risk analytics market is segmented into on-premise deployments and cloud deployments. In 2021, the on-premise deployments segment is expected to account for the larger share of the overall risk analytics market, mainly due to data sensitivity and the greater control over the analytics infrastructure offered by such solutions. However, with growing deployments, particularly across small and medium-scale organizations, the cloud deployments segment is expected to record the higher CAGR during the forecast period. Benefits such as flexibility, agility, and scalability offered by cloud-based analytical solutions are key factors driving the growth of this segment.
Based on organization size, the global risk analytics market is segmented into small and medium-sized enterprises (SMEs) and large enterprises. In 2021, the large enterprises segment is expected to account for the larger share of the overall risk analytics market due to the large enterprises' strong infrastructure and availability of skilled IT personnel to manage risk analytics platforms. Besides, the higher incorporation of risk analytics tools across large enterprises for managing various risks has also led to the dominance of the large enterprises segment. However, the SMEs segment is expected to record the higher CAGR during the forecast period. The realization of the potential of risk analytics tools by small and medium-scale enterprises and the availability of cost-effective risk analytics solutions for small-scale projects offered by leading risk analytics providers are the key factors driving the segment's rapid growth.
Based on end user, the risk analytics market is segmented into BFSI, retail, IT & telecom, healthcare, government, manufacturing, energy & utilities, transportation, and other end users. In 2021, the BFSI segment is expected to account for the largest share of the overall risk analytics market. The growth of this segment is mainly attributed to rising transactional data and growing demand for risk & fraud analytics solutions. Furthermore, increasing incidences of money laundering and fraud have encouraged market players in the BFSI sector to adopt risk analytics solutions.
However, the healthcare segment is projected to grow at the highest CAGR during the forecast period due to increasing concerns regarding fraud risks related to health data. The proliferation of digitization technologies such as AI and the IoT generates tremendous volumes of patient and healthcare provider data, and the recent COVID-19 crisis has also compelled organizations in the healthcare sector to adopt new prescriptive analytics such as risk analytics to prevent data breaches and other cyber risks. Hence, the adoption of risk analytics services and solutions is expected to grow significantly in the healthcare sector over the coming years.
Geographically, the global risk analytics market is segmented into five regions, namely, North America, Europe, Asia-Pacific, Latin America, and the Middle East & Africa. In 2021, North America is expected to account for the largest share of the global risk analytics market, followed by Europe and Asia-Pacific. The largest share of the North American region is mainly attributed to the presence of prominent players offering advanced risk analytics solutions and services across different industry verticals and the increasing use of AI and blockchain technologies in the region. However, Asia-Pacific is expected to record the highest CAGR during the forecast period. The high growth rate is mainly attributed to the advancements in AI, machine learning, and IoT technologies and the rapid development of the FinTech industry in Asia-Pacific.
The global risk analytics market is highly fragmented, comprising several small companies, start-ups, and international players. These companies are adopting various strategies to stay competitive and increase their market shares. The development of new analytics tools and services and strategic partnerships, collaborations, and agreements are some of the key growth strategies adopted by the leading players in this market. The majority of partnerships and collaborations are aimed at broadening product portfolios, advancing the technological capabilities of existing products, and developing capabilities to cater to the changing demands of users. The growing adoption of security analytics; increased demand for cloud-based services; and advancements in AI, IoT, and blockchain technologies are encouraging companies to focus on risk analytics platforms.
Some of the prominent players operating in the global risk analytics market are Verisk Analytics, Inc. (U.S.), Moody's Analytics, Inc. (U.S.), IBM Corporation (U.S.), Oracle Corporation (U.S.), Provenir (U.S.), AxiomSL, Inc. (U.S.), Gurucul (U.S.), SAS Institute Inc. (U.S.), OneSpan, Inc. (U.S.), Fidelity National Information Services, Inc. (U.S.), Numerix (U.S.), Recorded Future, Inc. (U.S.), SAP SE (Germany), and Risk Edge Solutions (India) among others.
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