Third-party risk management market grows amid rising threats

The global third-party risk management (TPRM) market was valued at USD 5.68 billion in 2022 and is projected to reach USD 18.20 billion by 2030, growing at a CAGR of 15.67% from 2022 to 2030. The market is gaining momentum due to rising concerns over data breaches, cybersecurity threats, and regulatory compliance associated with third-party vendors, suppliers, and partners. As businesses expand their ecosystems, the need to proactively manage third-party risks is becoming vital. The Asia Pacific region is expected to register the fastest growth, driven by increasing digitalization, regulatory reforms, and expanding global supply chains.

Market Overview

Third-party risk management (TPRM) refers to the identification, assessment, and mitigation of risks associated with external entities that an organization engages with — including vendors, suppliers, contractors, affiliates, and outsourced partners. TPRM strategies aim to ensure that these third parties do not expose the organization to financial loss, legal penalties, reputational harm, or data breaches.

Historically, TPRM was a compliance-focused activity handled in silos. However, the evolution of cyber threats, stringent data protection laws like GDPR and CCPA, and highly interconnected business models have transformed TPRM into a core business function. Today’s TPRM systems integrate automation, AI-based risk scoring, and continuous monitoring tools that offer real-time insights and support agile risk mitigation.

Market Dynamics

• Drivers:
  • Escalating cybersecurity threats and data privacy regulations
  • Increasing reliance on outsourced services and vendors
  • Complex global supply chains requiring robust risk oversight
  • Growing demand for centralized risk visibility and reporting tools
• Restraints:
  • High cost of implementing advanced TPRM platforms
  • Resistance to change and lack of internal expertise
  • Inconsistent regulatory frameworks across regions
• Opportunities:
  • Integration of AI, ML, and predictive analytics in TPRM solutions
  • Cloud-based and modular TPRM systems for SMEs
  • Rising adoption across healthcare, BFSI, manufacturing, and IT sectors

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Market Segmentation

• By Type: Software, Services
• By Genre/Application: Financial Risk, Operational Risk, Cyber Risk, Compliance Risk, Strategic Risk
• By Distribution (Deployment): On-Premise, Cloud-Based
• By Region: North America, Europe, Asia-Pacific, Latin America, Middle East & Africa

Competitive Landscape

The TPRM market is characterized by intense competition among cybersecurity firms, governance, risk & compliance (GRC) solution providers, and enterprise software vendors. Leaders focus on offering scalable, integrated platforms with analytics, automation, and real-time monitoring capabilities. Key players include:

• RSA Security LLC – Offers Archer Suite, a comprehensive GRC platform with TPRM capabilities
• MetricStream Inc. – Specializes in risk-based performance management and compliance tools
• NAVEX Global – Known for its integrated risk management and ethics compliance solutions
• LogicManager, Inc. – Provides cloud-based solutions for third-party and enterprise risk
• Prevalent, Inc. – Focuses solely on TPRM with vendor risk assessments and threat intelligence
• BitSight Technologies – Offers cybersecurity ratings and continuous monitoring services
• OneTrust – A rising player offering third-party risk modules as part of broader privacy platforms

Regional Trends

• North America dominates the market due to mature regulatory frameworks, widespread digitization, and high levels of outsourcing across industries.
• Europe benefits from stringent data protection laws (GDPR), pushing companies to adopt strong TPRM systems for compliance and operational resilience.
• Asia-Pacific is poised for fastest growth, driven by rapid industrial expansion, adoption of cloud services, and increasing focus on compliance in countries like China, India, and Southeast Asia.
• Latin America and Middle East & Africa are emerging markets, where growing digital transformation initiatives and cybersecurity awareness are paving the way for TPRM solutions.