Tag: Fraud Detection Software

The Real Cost of Building Fraud Detection Software: What to Expect

Fraud detection software is not a luxury today. Rather it is a necessity. More and more organizations are using fraud detection software to

Fraud detection software is not a luxury today. Rather it is a necessity. More and more organizations are using fraud detection software to identify fraudulent activities and prevent them from causing financial damage as well as reputational damage. As per the American Bankers Association authorized fraud rose by a significant 22% last year. For your information the fraud detection and prevention market is projected to touch USD 272.34 billion by 2031. Critical industries needing quality fraud detection software include finance, retail, healthcare, and others. By not using fraud detection software organizations face the risk of adverse financial as well as reputational repercussions.

Why Do Organizations Need Fraud Detection Software?

  • Ensure Client Loyalty

 If an organization’s environment is secure, clients feel that their data and money is safe. This leads to trust as well as retention of clients.

  • Save Significant Money 

The relevant software prevents frauds from happening. So, businesses do not lose money because of fraudulent transactions. Organizations save money by not having to do manual fraud detection. This fraud detection process is automated as well as speedier.

  • Superior Compliance

The software helps enterprises to adhere to relevant regulations such as HIPAA (Health Insurance Portability and Accountability Act), PCI DSS (Payment Card Industry Data Security Standard), GDPR (General Data Protection Regulation) as well as others. This method is faster and less error prone as compared to humans doing the activity.

  • Real-Time Fraud Prevention

This feature prevents or minimizes financial loss as well as associated brand damage.

  • Protect Client Privacy

In sectors such as health care it is imperative to maintain the confidentiality of patient data.

 

Different Stages of Building Quality Fraud Detection Software

We take a look at the cost of building Fraud Detection Software

  • Planning Stage (Estimated cost $5,000-$20,000)

First the desired features of the fraud detection software are listed. They should have all the functionality provided by similar software and more. There should be unique features not offered by anybody in the market. The stakeholders have to brainstorm to come with the different desired features. The technologies to be used in software development have to be finalized. The cost of software development tools significantly affects the cost of the final software. The software should be customized to meet the specific as well as unique needs of your organization. The business goals as well as the project scope are defined in this stage.

Desired features include preventing identity fraud, account takeover, transaction fraud, regulatory compliance, fraudulent chargebacks, fraudulent insurance claims, and more. There should be biometric authentication using voice recognition applications, fingerprint, or facial recognition. In the latter the face of the user is compared to a stored image. The voice of the user should be compared to the voiceprint obtained during customer support calls as well as other resources. AI (Artificial Intelligence)/ML (Machine Learning) technologies can be leveraged to detect frauds in real time. AI can process vast numbers of transactions in real time and identify suspicious transactions. ML algorithms learn from data and adapt to meet new types of frauds quickly and seamlessly. 

  • Designing Stage (Estimated cost $10,000-$25,000)

The user interface as well as the user experience are created. You will get an idea how the final product will look like. If you wish you can include dashboards in the design. Deliverables include wireframes and prototypes.

  • Development Stage (Estimated cost $50,000-$200,000)

The front end and back end are created in this stage. The software technologies used and the rates of the software developers determine the cost. For instance, in the USA and Western Europe the rates of the developers are relatively high. On the other hand, the rates of the developers based in India or Eastern Europe are relatively less. The sophistication as well as capabilities of the AI algorithms used have a bearing on the cost. Implementation of the AI /ML algorithms is carried out.

  • Integration Stage (Estimated cost $10,000-$40,000)

This involves integrating the software with relevant APIs, quality payment gateways and existing systems such as CRMs or ERPs. Machine learning models with the twin goals of detecting fraud as well as risk scoring are built.

  • Testing Stage (Estimated cost $10,000-$30,000)

One desired objective is minimizing ‘false positives’. The latter flags legitimate client transactions. This is a leading cause of clients discontinuing the services of many businesses as well as organizations. The major types of testing are unit testing, integration testing as well as user acceptance testing. The last type of testing checks if the software deliverable has all the features and functionality expected by stakeholders. The software needs to be checked for security levels and effectiveness against different types of cyberattacks.

  • Deployment stage (Estimated cost $5,000-$15,000 monthly)

 The fraud detection software deliverable is deployed to the production environment. Utilizing AI/ML may need usage of cloud services as the former require immense computational and performance resources as well as capabilities. Options include AWS (Amazon Web Services), Microsoft Azure, GCP (Google Cloud Platform) and others.

  • Maintenance Stage (Estimated cost $5,000-$20,000 monthly)

24/7 support is desirable to resolve client queries as well as issues. Bugs need to be fixed as and when they arise. Performance issues need to be constantly monitored. If new and better technologies emerge the software may need to be revamped/ upgraded to leverage the benefits of state-of-the-art technology. If your organization grows the software may have to be scaled up to accommodate higher volumes. Training may have to be given to the organization’s employees on how best to utilize the fraud detection software. 

Developing high-quality fraud detection software costs usually between $150,000 and $500,000. The time taken to develop the software can vary from 6 months to a year depending on factors such as size, complexity, number of features, technology used, salaries, cloud services and others. With good quality fraud detection software integrated with your enterprise’s systems, operations and processes your organization is up-to-date with market trends as well as have a competitive edge. The investment in fraud detection software will surely generate a high ROI both in the short-term as well as long-term.

With extensive software development expertise and multiple domain knowledge CoffeeBeans is perfectly placed to develop customized fraud detection software for your organization. You can also approach us in case you want any modification or technology migration of your existing fraud detection software. Our clients can vouch for our transparency, real-time response as well as adherence to stipulated deadlines. We offer stellar quality and performance at competitive rates. Reach out to us at enquiries@coffeebeans.io to know how we can help you meet your specific and unique requirements. You can safely outsource the work of developing fraud detection software to us and be assured of top-notch results.