Why Outsource Your Financial Tech Support?
Financial technology or fintech, for short, has greatly benefited from partnerships with outsourcing companies. Fintech companies were able to reduce costs, increase intellectual capital, reach more markets, and provide better customer service because of outsourcing. But, there are more reasons to get on board with fintech outsourcing. Here are the best of them.
#1 Fintech outsourcing is the ideal choice for small-to-medium-sized firms and startups.
Most fintech companies are small outfits that operate virtually and often had to operate with limited resources. The only way they can become competitive in the digital economy is to source the best technologies and custom-built back-office support teams from outsourcing providers. Thus, they’re not burdened with the need to invest in physical assets that they may not have space for or the competency to utilize them fully.
#2 Outsourcing firms can provide much-needed flexibility and scalability to fintech companies.
They can hire a team of engineers and designers to create their software or app. But, they don’t have to hire them permanently. They can improve their customer service ratings by hiring a competent team of customer care representatives from an outsourcing company. But, they have the option to start small and only increase the number of people in their team when the need arises and not before. Plus, employee costs can be externalized through recruitment process outsourcing.
#3 Outsourcing companies in emerging markets offer fintech companies localized services for their global customers.
People tend to break down into an emotional mess when they had to deal with a problematic financial transaction. It would be a relief for fintech end-users to talk to customer care representatives in their language about a transaction that went awry. If English wasn’t the first language of customers, it would be hard to deal with them unless the agents were more than familiar with the language and culture of the end-users.
And so… Fintech companies choose to outsource their business processes to service providers that are located in markets where their most active and loyal customers live and work.
#4 Fintech outsourcing contributes to increased adoption of financial services among disadvantaged populations.
The virtualization of fintech services, localization of customer experience, and widespread adoption of advanced mobile technology contributed to the increased adoption of banking and financial services among disadvantaged people who were traditionally underserved. These contributing factors are possible because of fintech outsourcing.
#5 The “puzzle” model of outsourcing helps fintech companies better manage the risks.
Fintech companies usually outsource different areas of their business operations to different vendors. For example, a fintech company that offers peer-to-peer lending through an app can delegate its UX design and software development to one provider, partner with a second provider for blockchain-based solutions, and then outsource its business process outsourcing to a third.
Each of these companies has expertise in their respective domains, but the risks are divided for each. This means if one of them encounters a problem, the others can still function while the fintech company regroups and selects another provider to temporarily take the place of the one that got in trouble.
As the fintech industry gradually matures, more and more companies will continue to outsource to strategically position themselves in the market. Their ability to balance their outsourcing initiatives with the continuous improvement of their core products and services will be a key factor in helping them adapt and respond immediately to the changing needs of the industry.