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Back Officea Outsourcing Market in the Financial Services Sector 2016-2020

  • Published: May 2016
  • Pages: 65
  • SKU: IRTNTR9401
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This market research report presents a detailed analysis of the global back office outsourcing market share in the financial services sector by category (hardware, software, and services) and by geography (the Americas, APAC, and EMEA). Some of theleading vendors in the back office outsourcing solution market are Accenture, Infosys, IBM, and TCS.

Overview of the global back office outsourcing market in the financial services sector

Technavio’s market research analyst predicts the global back office outsourcing market in the financial services sector to grow at a CAGR of around 7% by 2020. Back office outsourcing is a cost-effective arrangement that helps organizations to save up to 30% of its operational costs. This cost efficiency is achieved because the outsourcing companies help enterprises to manage routine responsibilities at very minimal costs, which in turn, reduces their overhead liabilities. Back office outsourcing companies offer several benefits to the financial institutions such as access to specific domain knowledge, best practices, new ideas, and high-quality talent for data-related services. With such quality outsourcing services, the organizations are able to deliver projects in lesser time and at affordable prices. 

According to this market research report, an interesting back office outsourcing trend gaining traction in the market is the increased adoption of cloud computing and virtualization solutions among financial institutions. By implementing these services, financial institutions can outsource their IT infrastructures at reduced costs. Virtualization enables centralized deployment and management of virtual desktop environments to enhance safety measures for desktop access and data sharing over standard network infrastructures. Many players such as Kotak Mahindra life Insurance and Reliance General Insurance, have adopted Vmware-based virtualization solutions to improve the efficiency of their data centers, which will, in turn, reduce their overall infrastructural costs.

Segmentation by category and analysis of the back office outsourcing market in the financial services sector

  • Hardware
  • Software
  • Services

The services segment dominated the market in 2015 and accounted for around 54% of the total market share. Information technology outsourcing (ITO) and business process outsourcing (BPO) are the two major outsourced services under this segment, out of  which ITO occupies around 89% of the overall market share. Factors such as the growing need for digital technologies to improve business efficiency, increased regulatory compliance costs, and competition from non-banking organizations in areas such as payments will fuel this segment’s growth during the forecast period.

Geographical segmentation and analysis of the back office outsourcing market in the financial services sector

  • Americas
  • APAC
  • EMEA

During 2015, the Americas was the key revenue contributor and occupied around 47% of the overall market revenue. A rise in the number of outsourcing deals and implementation of various acts such as Dodd-Frank Act and HIPAA have necessitated financial institutions to outsource their business processes. Continuous regulatory and economic volatility issues faced by financial organizations will bolster this market’s growth prospects in the Americas.

Competitive landscape and key vendors

This market is highly fragmented due to the presence of numerous large and small players.  In this market, the vendors differentiate themselves by offering innovative, cost-effective, and outcome-based solutions such as BPaaS. Vendors are also increasing their profitability by implementing innovative solutions as per clients' requirement with flexible pricing, which helps organizations to address cost savings issues. Competition in the back office outsourcing solution market is expected to intensify with the entry of new players during the forecast period.

Key vendors in this market are -

  • Accenture
  • Infosys
  • IBM
  • TCS

The other prominent vendors in the back office outsourcing solution market in the financial services sector include Aegis, Attra Infotech, Birlasoft, Capgemini, CGI, Cognizant, CSC, Dell, eClerx, Endava, EPAM, EXL, HCL, Hexaware, HP, IGATE, Infosys, ITC Infotech, L&T Infotech, Luxoft, Mindtree, Mphasis, NIIT Technologies, Polaris Consulting and Services, Serco Global Services, Softtek, Sutherland Global Services, Syntel, Tech Mahindra, Unisys, Virtusa, Viteos Fund Services, Wipro, WNS, Xchanging, Xerox, and Zensar.

Key questions answered in the report include

  • What will the back office outsourcing market size and the growth rate be in 2020?
  • What are the key factors driving the global back office outsourcing market in the financial services sector?
  • What are the key back office outsourcing trends impacting the market growth in the financial services sector?
  • What are the challenges to the back office outsourcing market growth?
  • Who are the key vendors in the global back office outsourcing market in the financial services sector?
  • What are the market opportunities and threats faced by the vendors in the global back office outsourcing market in the financial services sector?
  • Trending factors influencing the back office outsourcing market shares of the Americas, APAC, and EMEA.
  • What are the key outcomes of the five forces analysis of the global back office outsourcing market in the financial services sector?

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Table of Contents

PART 01: Executive summary

  • Highlights

PART 02: Scope of  the report

  • Market overview
  • Top-vendor offerings

PART 03: Market research methodology

  • Research methodology
  • Economic indicators

PART 04: Introduction

  • Key market highlights

PART 05: Market landscape

  • Market overview
  • Market size and forecast
  • Five forces analysis

PART 06: Market segmentation by category

  • Segmentation of global back office outsourcing market in financial service sector by category
  • Hardware
  • Software
  • Services

PART 07: Geographical segmentation

  • Geographical segmentation of global back office outsourcing market in financial services sector
  • Americas
  • EMEA
  • APAC

PART 08: Market drivers

  • Greater efficiency and productivity
  • Cost savings
  • Risk mitigation
  • Increase in outsourcing of ATM back office services
  • Need to conform with regulatory compliance

PART 09: Impact of drivers

PART 10: Market challenges

  • Increased security concerns
  • Inconvenience for company employees
  • High levels of attrition and employee turnover
  • Lack of domain expertise
  • Adhering to varied requirements

PART 11: Impact of drivers and challenges

PART 12: Market trends

  • Increased adoption of digital and mobile solutions
  • Consistent occurrence of outsourcing deals pertaining to back office services
  • Rise of big data in financial services
  • Increased adoption of cloud computing and virtualization

PART 13: Vendor landscape

  • Competitive scenario
  • Major vendors
  • Other prominent vendors

PART 14: Key vendor analysis

  • Accenture
  • IBM
  • Infosys
  • TCS

PART 15: Appendix

  • List of abbreviations

PART 16: Explore Technavio

Research Framework

Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.

TechnavioINFORMATION SOURCES

Primary sources

  • Manufacturers and suppliers
  • Channel partners
  • Industry experts
  • Strategic decision makers

Secondary sources

  • Industry journals and periodicals
  • Government data
  • Financial reports of key industry players
  • Historical data
  • Press releases
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TechnavioDATA ANALYSIS

Data Synthesis

  • Collation of data
  • Estimation of key figures
  • Analysis of derived insights

Data Validation

  • Triangulation with data models
  • Reference against proprietary databases
  • Corroboration with industry experts
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TechnavioREPORT WRITING

Qualitative

  • Market drivers
  • Market challenges
  • Market trends
  • Five forces analysis

Quantitative

  • Market size and forecast
  • Market segmentation
  • Geographical insights
  • Competitive landscape
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