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BPO growth in India will slow down: Forrester
July 11, 2006 18:21 IST

The growth of offshore business process outsourcing industry in the country is likely to further slow down over the next one year amid concerns over data security breach, high attrition rates and staffing costs, rising competition and continuing margin pressures, global research firm Forrester said.

The US-based technology and market research major said in a report on the offshore BPO industry that the growth rate would come down to 28-30 per cent over the next 12 months from nearly 35 per cent currently.

In the past 12 months, the Indian BPO growth rate dropped from 48 per cent in FY04-05 to 35 per cent in FY05-06.

Forrester said that the recent instance of data leakage at HSBC's India centre reaffirms that offshore BPO growth will slow down amid security concerns.

The incident has come as a major blow to the prevailing common belief that captive BPO and IT centres are a safer approach to offshore outsourcing and that such frauds are more likely to happen when working with a third-party outsourcer, it added.

An employee at HSBC's Bangalore centre allegedly leaked the personal and debit card information of more than 20 British customers to a racket of fraudsters in London, while �233,000 worth of money was stolen from the customers' bank accounts through ATMs, debit cards, and telephone banking.

The employee has been arrested by police and investigations are on to identify his accomplices in London.

Forrester said this episode is much more sophisticated and involves a nexus of offshore data piracy with onshore physical theft, as compared with the past events.

Outsourcing and India: Complete Coverage


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