Outsourcing has been around for centuries; it was first recognized as a business strategy in 1989. Indeed, over the course of the twentieth century manufacturing industries transformed outsourcing from a loose economic theory into their core growth strategy.

Today banks and financial institutions are discovering how outsourcing can empower overworked and underworked resources in order to cut costs and bring added value for investors and customers.

What exactly is outsourcing?

Outsourcing is simply the process by which an organisation delegates some of its in-house operations or processes to a third party. While in contract, ownership or control of those processes generally remain with the parent company. Third parties are responsible for carrying out and reporting on the predefined tasks. Outsourcing is primarily used to cut costs and focus more on the core aspects of the business.

There are several types of outsourcing that have become incredibly commonplace: IT outsourcing, business process outsourcing or even ‘full-fledged product outsourcing’ which is an emerging trend in outsourcing amongst financial institutions.

Banks and financial institutions can outsource both their IT operations and business operations. If they outsource only their IT operations, we can talk about “Software as a Service”. The SaaS model (Software as a Service) can cover the entire payment value chain, from the card management processing, ATM / POS driving and processing, to BPO services.

Why outsourcing?

Outsourcing is a promising business model: according to Gartner, between 2020 and 2025, the SaaS model will continue to grow. As of today, the SaaS market increases by 18% each year. Indeed, 70% of the CIOs highlight the importance of agility, flexibility and scalability when using a SaaS model.

Cost is one of the primary reasons to select a SaaS model. The Software as a Service model enables the reduction of the ‘upfront’ investment cost but also has a direct impact on the reduction the IT costs, helping redirect resources internally.

With this outsourcing model, banks and financial institutions can very quickly access to cutting-edge technology, and ultimately stay relevant in this ever-evolving world. This way, they can focus on what they do best: their business.

As a result, when outsourcing in SaaS model their payment activities, banks and financial institutions can improve operational performance and speed, reduce operational risk and increase efficiency through better consolidation and centralisation of functions.

Outsourcing with HPS

HPS provides future-proof payment solutions, that can be delivered in SaaS mode. By outsourcing with HPS, you will boost your performance and control your costs.

To know how HPS can support your outsourcing project, please contact sales@hps-worldwide.com