AI Model Risk Management Market Size Worth $19,036.19 million by 2034 | CAGR: 12.8%

The global AI model risk management market size is expected to reach USD 19,036.19 million by 2034, according to a new study by Polaris Market Research. The report “Global AI Model Risk Management Market Size, Share, Trends, Industry Analysis Report: By Offering (Software by Type, Software by Deployment Mode, and Services), Risk Type, Application, Vertical, and Region (North America, Europe, Asia Pacific, Latin America, and Middle East & Africa) – Market Forecast, 2025 – 2034” gives a detailed insight into current market dynamics and provides analysis on future market growth.

The AI model risk management market is rapidly evolving as organizations increasingly adopt artificial intelligence (AI) technologies across various sectors. The market encompasses a range of solutions and practices designed to manage and mitigate the risks associated with the deployment and operation of AI models. These risks include model inaccuracies, biases, compliance issues, cybersecurity threats, and operational failures. Organizations in sectors such as finance and healthcare are leveraging AI to enhance operational efficiency, improve decision-making, and gain competitive advantages.

Governments and regulatory bodies worldwide are recognizing the importance of ensuring that AI systems are transparent, fair, and accountable. This has led to the development of new regulations and guidelines that require organizations to implement robust risk management practices. Compliance with these regulations is essential to avoid legal penalties and maintain trust with stakeholders, thereby driving demand for AI model risk management solutions.

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The increasing complexity of AI models also contributes to market growth. As AI technologies advance, models become more advanced and intricate, making it challenging to predict and control their behavior. This complexity can lead to unintended consequences, such as biased outcomes or incorrect predictions, which can have significant negative impacts on organizations.

Businesses are also investing in advanced risk management tools and practices that provide greater oversight and control over their AI models to mitigate these risks. For instance, in Finance, AI is being used for tasks such as fraud detection, credit scoring, and algorithmic trading. These applications require high levels of accuracy and reliability, as errors result in substantial financial losses. Consequently, financial institutions are implementing rigorous AI model risk management frameworks to ensure their models operate as intended and comply with regulatory standards.

Top of FormAI Model Risk Management Market Report Highlights

• In 2024, the fraud detection and risk reduction segment accounted for the largest revenue share in the AI model risk management market due to its critical role in safeguarding financial transactions and maintaining regulatory compliance.
• The healthcare and life science segment is growing at the highest CAGR due to the increasing adoption of AI for diagnostics, personalized medicine, and treatment planning, coupled with the high stakes of ensuring accuracy and compliance in patient care.
• In 2024, North America accounted for the largest market share in the AI model risk management market due to the region's advanced technological infrastructure, high adoption rates of AI across various industries, and stringent regulatory frameworks promoting robust risk management practices.
• Asia Pacific is expected to register a significant CAGR during the forecast period due to the rapid digital transformation, substantial government investments in AI technologies, and increasing adoption of AI across diverse industries.
• The global key market players include Alteryx, AWS, C3 AI, DataBricks, Google, H2O.ai, IBM, iManage, LogicGate, LogicManager, MathWorks, Microsoft, ModelOp, SAS Institute, and UpGuard.

Polaris Market Research has segmented the AI model risk management market report based on offering, risk type, application, vertical, and region:

By Offering Outlook (Revenue - USD Million, 2020 - 2034)

• Software by Type

• Model Management
• Bias Detection
• Explainable AI Tools
• Others

• Software by Deployment Mode

• Cloud
• On-Premises

• Services

• Professional Services
• Consulting and Advisory
• Managed Services
• Others

By Risk Type Outlook (Revenue - USD Million, 2020 - 2034)

• Security Risk
• Ethical Risk
• Operational Risk

By Application Outlook (Revenue - USD Million, 2020 - 2034)

• Fraud Detection and Risk Reduction
• Data Classification and Labelling
• Sentiment Analysis
• Model Inventory Management
• Customer Segmentation and Targeting
• Regulatory Compliance Monitoring
• Other Applications

By Vertical Outlook (Revenue - USD Million, 2020 - 2034)

• Banking, Financial Services, And Insurance (BFSI)
• Government and Public Sector
• Healthcare and Life science
• IT & Telecommunication
• Manufacturing
• Media & Entertainment
• Retail & E-Commerce
• Other Verticals

  By Regional Outlook (Revenue - USD Million, 2020 - 2034)

• North America

• US
• Canada

• Europe

• Germany
• UK
• France
• Italy
• Spain
• Russia
• Rest of Europe

• Asia Pacific

• China
• India
• Japan
• South Korea
• Indonesia
• Malaysia
• Australia
• Vietnam
• Rest of Asia Pacific

• Latin America

• Argentina
• Brazil
• Mexico
• Rest of Latin America

• Middle East & Africa

• UAE
• Saudi Arabia
• Israel
• South Africa
• Rest of Middle East & Africa

AI Model Risk Management Report Scope: