BPO sector eyes big investments from banking & finance industry

The business process outsourcing (BPO) industry is expecting big investments from the banking and finance sector as the BPO sector branches out from the usual call center activities.

“Right now the trend is more investments from the banking and finance. It is a captive sector,” Oscar Sanez, Business Process Association of the Philippines (BPAP) president said in an interview.

“A big part of the industry is made up of call centers. The plan now is to move into more specialized high value operations,” Sanez said.

Today, the BPAP will be presenting the global investment outlook for the outsourcing industry in the emerging markets.

Meanwhile, the industry is on track to meeting its year-end growth target as it employed 345,000 workers during the first half of the year.

“The industry employed 345,000 workers for the first six months of the year and we are hoping that we will meet our yearend target of 420,000,” Sanez said.

The offshoring and outsourcing (O&O) industry earned $5.8 billion during the first half of the year.

“We are on track to meet our full year revenue target of $6.8 billion,” Sanez said.

According to Sanez, O&O revenue for the first six months of the year is up 1.8 percent when compared to the same period the previous year.

Sanez said the slowdown in the world economy had no adverse effects on the industry. “The first half results are encouraging. I think we will meet our target stated in the 2010 roadmap.”

Sanez noted that the Philippines ranked third in the O&O industry. India remained number one, followed by Canada.

The Philippines is a good location for outsourcing because of the time zone.

However, Sanez said the problem of skilled workers may pose as a threat. “We are really doing our best to address this issue.”

Likewise, foreign businessmen have said that the problem of education has had a negative impact on the number of qualified workers available.

In fact, the education problem in the country will have an adverse effect on the investment behavior of businesses, European Chamber of Commerce of the Philippines (ECCP) executive Henry Schumacher said.

“We (businesses) can’t wait (for the government to implement reforms). The jobs will have gone somewhere else,” Schumacher warned.

He said if the private sector will wait for the government to solve the education problem then it will be too late. The country’s ASEAN neighbors, specifically Vietnam , are actively attracting foreign investors and are giving attractive packages for businesses in order to set up shop in their respective countries.