IT/BPO outsourcing trend continues to gain momentum

by Kelli Rogers14 Jun 2013

Indian IT and business process outsourcing companies are expected to double their revenues from mortgage process outsourcing to $316 million this year from $158 million in 2009, according to a report by HfS Research.

But this number seems low to Judy Wheatley, senior vice president of compliance for Indecomm Global Services, a consulting and outsourcing company. The bottom line is that outsourcing isn’t just expanding in India, she said, but also in Mexico and throughout Asia.

To control costs, many banks and financial institutions in the country are outsourcing a range of mortgage processing services including underwriting, loan verification, documentation for claims and counter claims and other foreclosure services.

“The mortgage industry is cyclical with ups and downs, so what outsourcing allows companies to do is to staff internally at a certain level, and utilize outsourced resources to flex up their volume and meet consumer demand faster,” Wheatley said.

The trend to move mortgage BPO offshore is largely driven by banks’ need to reduce costs, and the labor cost in India is, depending on skill level, approximately 50% less than in the U.S., Wheatley said. But that’s not all a business has to gain, as Wheatley said there is impressive talent in India.

“The skillsets for those working in India in support of the mortgage industry have matured and developed in the past few years,” she said, noting that BPO companies often poach talent from each other.

Another benefit is the advantage of a 24/7 workforce, as many BPO companies hire for two or three different shifts to cover the whole day.

What has been successful for Indecomm is a blended approach, Wheatley said. A client may choose to outsource 100% of a function, but Indecomm will separate that function into parts performed in the U.S. and those performed in India. Oftentimes communication with customers is kept in the U.S., while clerical functions are outsourced to their offices in Singapore, Malaysia and India.

“We have found that we can be most successful with back office functions, which allows our clients to focus on their customers,” Wheatley said.

As far as mortgage companies interested in seeking out an outsource company, Wheatley recommends they do their due diligence in researching stability, financials and IT security requirements. Looking for a long-term partnership, rather than a quick fix to solve an increase in volume, is also key, she said.

“A good outsourcing company can bring new ideas to make the process more efficient.”


  • by Mary | 6/16/2013 1:49:18 PM

    I as a consumer would be very concerned people in other countries, out of the US Jurisdicition to have access to my most private information, ie our social security number, income, assets, and all the details about the nature of my business. Another concern is how many more jobs can the US workforce loose to foreign workforce before totally desintegrating our cherished way of life? We are in a depression, yet our Bankers want more profit. Where is the Consumer Protection Bureau on this.

  • by michael bian | 9/4/2013 10:21:27 PM

    I want to start a dialog with some BPO companies about my requirement.

  • by Hector Desai | 9/16/2013 5:53:27 AM

    Hi Mary, I think your concerns are totally legitimate and I share the same concerns. This is exactly what the author is trying to point out that the companies need to be very careful before partnering with outsourcing companies. You can not deny the fact that in today's world outsourcing plays a crucial part in making a company competitive so it can concentrate on it's core business and stay profitable. However this does not mean the company should not do its due diligence because if someone wants to steal information then it can happen even on American soil. So the key is the right partner and a strong strategy on outsourcing. A lot of our clients prefer 100% onshore and that's exactly what they get and some who prefer offshore but with strict guidelines have their customers documents & information stored in data centers in US with selective access to offshore partners who can not misuse the information. For ex: - one would have your CC number but not the expiry date and a third person would deal with your name so even if all three are sitting together they would not be able to figure out the information is of the same person. I think CFPB and other agencies have done a great job in the last few years to bring accountability in the process and its no longer an option to be complainant. Still if you have any questions then I will be happy to answer them.


Should CFPB have more supervision over credit agencies?