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India’s voice-based BPO exports buck doomsday projections

India’s BPO industry employs over 10 lakh people and contributes to around 25 per cent of the total IT/ITeS exports revenue from the country.

Stifling competition from the Philippines and Mexico notwithstanding, India’s voice-based call centres — the original flagbearer of India’s BPO boom in the mid-nineties — recorded a strong 11 per cent growth in export earnings at $7.4 billion last fiscal.

India’s voice-based BPO sector, which handle customer service and conduct telephonic sales for global clients and accounts for slightly over 40 per cent of the total export revenue of the country’s BPO industry, had recorded a 12 per cent growth in export earnings in 2012-13.

The double-digit growth in export revenues during the last couple of years by India’s voice-based BPO services — comprising around 400 voice-based BPO service providers who serve about 50 countries in more than 30 languages — comes at a time when the economies in the two key markets that it serves (the US and mainland Europe) is still coming out of the downturn.

It is also being seen as significant at a time when analysts had begun to write-off the Indian voice-based BPO services in the wake of the emergence of countries like Philippines, Mexico, South Africa, Costa Rica as alternate destinations in what is called the ‘Customer Interaction Services’ space.

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Earlier this year, a ranking of the top 100 BPO destinations published by consultancy Tholons placed Manila as the second-most-important BPO destination globally after Bangalore, pushing Mumbai to third place. Seven Philippine cities made Tholons’ top 100 list, including two in the top 10, with Cebu ranked eighth.

While increasing competition did result in a decline in the export share of the voice-based BPO services marginally by 4 percentage points in the last two years, according to industry body National Association of Software and Services Companies (NASSCOM), India is still considered as the world’s most preferred destination for BPO operations and doomsday scenario projections for India’s voice-based BPO industry are gradually beginning to recede.

According to a NASSCOM representative, while the Philippines is emerging as a strong player in pure voice customer service, when it comes to incremental technology-enabled services for customer support and in areas such as technology support, India continues to have a formidable edge. Pure-play BPO firms such as Genpact, EXL and WNS are among those that have moved up from low-end voice jobs at call centres for services that involve higher grade of industry expertise — areas such as legal and healthcare services — and generate stronger profit margins in the back-office service business. The BPO market in the US is expected to grow at 4.3 per cent on a compounded annual growth rate basis, reaching $97.3 billion in 2017, according to research firm IDC.


India’s BPO industry employs over 10 lakh people and contributes to around 25 per cent of the total Information Technology/ Information Technology Enabled Services (IT/ITeS) exports revenue from the country.

First published on: 09-12-2014 at 01:46 IST
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