The Indian banking transformation and transition to digitization in the past decade made the sector resilient. Today, the banking sector continues to impact the common man’s life by keeping the money safe, offering loans and ensuring easy online transactions. Moreover, it plays a significant role in the business landscape and the country’s economy, driving growth.

But ever wondered what drives a bank? That’s right: The front office and back office do.

The back office provides a robust structure over which all the bank operations are carried out. The back office personnel are responsible for efficient system operations and people productivity. As banking remains highly regulated, back office professionals help meet compliance regulations. It also supports sales and management.

In other words, the back office acts behind the scenes and offers complete support to the front office, making sure that banks offer the best customer experience. Given the crucial role back office plays in the current competitive market, banks are relying on back office outsourcing to stay ahead. Back-office outsourcing experts take on the mantle of simplifying the process, amplifying productivity and driving banks to achieve limitless growth.

To achieve consistent transformation in the front, improving what’s happening behind is critical. Further in the blog, find out how back office services help banks of today to innovate, evolve and remain profitable.

Back Office in Banking

To say that back office is key to the growth of banks would be an understatement; it takes care of an array of bank functions necessary to keep the operations running at a break-neck speed. With growing customer expectations that include speedy processing, engaging communication and superior support, the back office assures everything is in order.

Back office in simple terms means administrative and support responsibilities in a financial institution and does not require customer interaction. Some of the major segments that come under the back office include:

  • Loans
  • Deposits
  • Compliance
  • Auditing
  • Accounts
  • Human Resources
  • Risk Management

Back office experts also handle technical and operational requirements like:

  • Market Research
  • Data Entry, Data Mining and Data Analysis
  • Assisting Front-office
  • Assisting Sales, Marketing and Management Teams
  • Customer Transactions
  • Processing Expenses
  • Developing Reports

A plethora of responsibilities and overload of critical tasks can bog down even the most successful organisations. This is the reason why outsourcing services are embraced today to unburden back office teams and more importantly to reduce cost.

Back Office Outsourcing in Banks

Improving customer experience is a major challenge for banks today; back office outsourcing being the top solution. You would say how? Well, amidst the digital transformation, there are myriad functions - paperwork, adherence to laws, and compliance requirements - that need to be handled efficiently and outsourcing helps banks with these critical processes. In addition, banks get the opportunity to focus on core objectives like developing superior products and customer experiences. Find out the other benefits of back office services.

Benefits of Outsourcing Back Office Services in Banking

1. Operational Improvements

Every day, banks have to deal with a lot: management of the extensive amount of data generated, document processing and humongous transactional processes on a consistent basis that comprises application processing, order fulfilment, tool handling and whatnot. The regulatory environment has changed drastically too, increasing the complexities related to compliance and risk management. All of this can be too much for the in-house back-office team.

Additionally, when companies try to go to the next level, more than one pair of hands are necessary to support processes. This is where back-office outsourcing can help in operational improvements. Outsourcing experts are dedicated professionals with years of experience in handling different sets of challenges. Ultimately, expert support will boost the customer support quality, helping businesses grow.

2. Supporting Regulations

A business needs a robust back office at all times. Why? Primarily because of two reasons: security incidents and regulatory failures.

A security breach can put banks in serious trouble. However, keeping up with the changing regulatory frameworks for banks is the key driver for choosing back-office outsourcing services. As regulations become more stringent, departments and services are being separated. Outsourcing promises to make banks more resilient and enable them to meet regulatory requirements. Additionally, experts offer confidentiality and integrity of outsourcing services, helping businesses achieve more compliance quality and security standards.

3. Eliminating Manual/Data errors

Manual and data errors can prove to be too costly for banks. Imagine adding or subtracting a simple zero from the amount. Several incidents have occurred where banks have lost money due to inaccuracies. Outsourcing back office functions can help eliminate manual/data errors.

Special attention can be paid by the outsourcing team along with the streamlined process to verify the authenticity of the reports, data and other relevant numbers of high importance.

Another aspect to be considered is the outsourcing of critical bank office functions, which can help businesses experience peace of mind. In addition, 24x7 available back office experts can help businesses achieve enhanced productivity.

4. Technological Solutions and Training

While banks might be on a technology investment spree, it is focused towards the front office and how it changes customer engagement. Substantial changes need to be done at the back office too. However, many companies miss the opportunity to transform back-office operations.

A back-office outsourcing company like Calibehr with tech-powered solutions can change the game for companies. Access to high-end technology and the latest solutions can help you thrive at the biggest of stages.

Another benefit of outsourced back office expertise is training. The dedicated teams always get trained and stay updated, capable of delivering high performance for clients– which means a distinct advantage for your business.

5. Improved Bottom Line

One of the chief reasons banks outsource back office tasks is cost reduction. The experts take care of the tedious, repetitive and sometimes boring tasks that include data entry, data management and the like. Thus, the bank accomplishes SLA goals, timely transactions, risk reduction, high service quality, and better impact, improving the bottom line.

Calibehr is a leading back-office services company with more than 15+ years of experience in the field. The expert team has helped countless banking clients transform their back-office operations in India as well as abroad. If you are looking to outsource back office functions, contact us today.

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