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BFSI GCCs – The Road Ahead

January 17, 2022 3461 0 GCC

BFSI GCCs – The Road Ahead

The global BFSI industry has experienced digital embedment across the business value chain while gearing up to provide an omnichannel customer experience while continuing to address emerging opportunities presented by new emerging players, the ESG focus and all while meeting the requirements of the regulators.

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The Financial Services industry is at the epicenter of this change, influencing buying behavior, individual and business transactions across the global ecosystem.  The industry has evolved and transformed its global service delivery model through establishing ‘Global Capability Centers’ (GCC).  This report intends to share how GCCs will be pivotal in shaping the businesses of the future and will act as a guiding map for organisations to start redesigning their offerings and influencing customer experiences.

Led by India's skilled talent-base and supportive government policies, BFSI GCCs in India have acted as a key lever to support the growing global needs and driving the transformation of the industry.  This is accentuated by the fact that 21 per cent of all GCC employees in India work in the BFSI sector, although BFSI GCCs only account for 12 per cent of the total number of GCCs.

GCCs have served as engines for enterprise transformation and are gradually transitioning by reorienting their nature of work by moving from a volume to a value-based model by improving efficiency through AI/ML, automation and IoT, and establishing various niche global technology Centers of Excellence.

This report titled “BFSI GCCs – The Road Ahead” authored by KPMG in India, in partnership with NASSCOM provides an overview of the BFSI-GCC landscape in India, how it has evolved and provides a sneak peek into the road ahead for this sector. The report also has some interesting case studies of success stories / initiatives by BFSI GCCs around key transformation levers.

Key Trends

Key signals of change in the BFSI sector

  • The BFSI value chains are getting disrupted faster than ever and BFSIs are adapting themselves to respond to the forces of changes
  • Focus on customer centric personalised solutions with real time financial services products
  • Strict regulatory scrutiny and adoption and deployment of RegTech & SupTech tools
  • Entry of fintech challengers (challenger banks, neo banks, etc.) and emergence of innovative solutions
  • Accelerated digitisation transformation such as modernisation of legacy systems, cloud adoption, real time payment solutions etc.
  • New operating models, proactive risk management and risk modelling, and eco system collaboration is witnessed

BFSI GCC landscape of India 

  • 170–175 GCCs in India run by 85-90 BFSI MNCs; 6.6 per cent CAGR of BFSI GCCs in India in the last 10 years
  • 295,000–300,000 people employed in BFSI GCCs in India; 21% of all GCC employees in India work in the BFSI sector
  • Bengaluru ranks first in terms of BFSI GCCs across India, with around 25-30 percent of the BFSI GCCs followed by Mumbai and Delhi NCR region (~15-20 percent respectively)

Key transformation levers for BFSI GCCs

  • BFSI GCCs are enabling the transformation path by focusing on various growth levers
  • Evolution of GCCs into business solution centers
  • Driving innovation and leveraging the partner ecosystem
  • Spearheading digital transformation for the parent organisation
  • Combating global cyber risks, with dedicated security capability centres.
  • Adopting smart sourcing and rebalancing sourcing mix
  • Redefining work placement by building digital workplace
  • Building workforce of the future
  • Augment risk management and resilience capabilities

Road ahead

  • Digitisation across the value chain, ownership of customer journeys and continuing to build new-age talent & domain expertise
  • Ecosystem approach to delivery that allows for differentiated capabilities while retaining focus on enhancing margins
  • Accelerated movement from a role-based to a skills-based organisation
  • Rebalanced service portfolio encompassing virtual and automated service delivery while reducing concentration risk
  • Increased pressure to deliver lasting results for stakeholders and addressing emerging technology risks including ESG issues
  • Innovation roadmap that incentivises tangible outcomes and moves towards value/outcome-based delivery

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