Latest News:- Outsourcing In BFSI Sector Market: ITO is expected to lead the Type segment during 2024-2028

Outsourcing In BFSI Sector Market to grow at a CAGR of 4.5% during 2024-2028

The Outsourcing In BFSI Sector Market is expected to grow at a CAGR of 4.5% during 2023 and 2028. During this period, the market is also expected to show a growth of USD 28.2 billion. In the BFSI sector, outsourcing industries have adopted emerging technologies such as cloud computing, artificial intelligence (AI), social media, and process automation to drive growth and cost savings. AI software streamlines process functions, enhancing efficiency, while cloud storage eliminates the need for excessive physical storage, reducing energy consumption. By 2025, it is projected that 83% of enterprise workloads will be stored on the cloud. Leveraging cloud products and Software as a Service (SaaS), companies can access the latest technologies, fostering growth in the global outsourcing market within the BFSI sector. 

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The ITO subsegment is expected to dominate the Type segment during the forecast period 

Technavio analysts predict that the ITO subsegment will lead the Type segment during 2024 and 2028 The BFSI sector's increasing digitization and resulting data generation are primary drivers propelling the Information Technology Outsourcing (ITO) market's expansion during the forecast period. With the surge in digital transactions and new user additions, financial institutions seek to enhance operational efficiency by outsourcing non-critical content to IT outsourcing providers. The vast amount of customer behavior data being generated as organizations prioritize customer-centricity necessitates effective handling. IT outsourcing enables financial institutions to tackle challenges, including compliance, content management, security, transparency, and platform-geographic availability.

Here are the various ways based on which the market is segmented: 

• Type
  • ITO
  • BPO
• Geography
  • North America
  • Europe
  • APAC
  • Middle East and Africa
  • South America

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There are several factors that are causing the market to flourish increasing need for adherence to regulatory compliance

Learn which are the obstacles that the market is experiencing in the way of its growth by accessing the free PDF report

Research Analysis Overview

The Business Process Outsourcing (BPO) market in the BFSI sector has been growing significantly due to the need to improve efficiency, reduce costs, and streamline processes. Customer service is a major area where BFSI companies are outsourcing, as specialized expertise and 24/7 support can lead to better customer experience. Back-office operations such as transaction processing, threat detection, error reduction, and regulatory compliance are also commonly outsourced. Outsourcing also allows for automation, advanced analytics, and digital transformation, which can lead to cost savings and operational efficiency. However, it's important to note that outsourcing also comes with risks, such as compliance risks and cybersecurity concerns. BFSI companies are turning to AI and Gen AI to enhance customer relationship management and improve accuracy in areas like fraud detection and error reduction. Advanced technologies like blockchain and AI are also being used to streamline processes and ensure regulatory compliance. Outsourcing can provide a competitive advantage by allowing companies to focus on their core competencies while outsourcing non-core functions. Overall, the BFSI BPO market is expected to continue growing as companies seek to reduce costs, improve efficiency, and enhance customer experience.

Market Research Overview

The IT services market encompasses organizations providing IT consulting and integration, application, data processing, business process outsourcing, infrastructure, and Internet services. The global IT consulting and other services market segment specifically caters to companies offering IT consulting and information management services. According to Technavio, this market's size is determined by the consolidated revenue generated by businesses delivering all types of IT consulting and information management services. This revenue is derived from IT service contracts executed annually. Key growth drivers for the global IT consulting and other services market include substantial government investments in modernizing IT infrastructure to address the shortage of experts in contemporary IT skills.

The Outsourcing In BFSI Sector Market is experiencing significant growth, fueled by the increasing need for adherence to regulatory compliance. Industries are leveraging the products belonging to the market for customer engagement, transactional notifications, and promotional offers.

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