Many market research agencies predict that the knowledge process outsourcing (KPO) industry will be worth between $10 billion (about Rs 40,000 crore) and $17 billion (about Rs 68,000 crore) by the year 2010.
While the level of optimism on industry growth varies, few doubt the fact that the industry will grow at a staggering rate. The financial services sector accounts for a major proportion of the KPO industry. Assuming a conservative growth of the global KPO industry, market research firm KPMG predicts the financial services KPO industry to be worth about $5 billion (about Rs 20,000 crore) by the year 2010.
India is expected to remain a preferred location for KPO activity but organisations are expected to look for alternative locations for additional delivery centres, both from a customer and service provider perspective.
Edge Zarrella, global partner-in-charge, IT advisory, KPMG, said in a statement, “Our study looks at the financial services KPO space which is driving the KPO evolution. Along the way we aim to show that KPO is a business phenomenon in its own right, not merely an elaboration of Business Process Outsourcing. KPO may still only represent a small percentage of the total outsourcing market but with the financial sector demonstrating just what it can be used for, I think that all of these numbers are set to increase significantly.”
The estimation is backed by the capabilities of IT and BPO captives and third-party vendors to handle outsourced work, the availability of high quality and often certified talent in offshore locations and the continuing push towards global sourcing by many banking and insurance organisations, among others.
