Outsourcing on the rise in financial sector

Cost pressures and the need for flexibility drive rapid increase in IT and business process outsourcing

IT outsourcing and business process outsourcing BPO are the fastest-growing service lines in the financial services sector, according to research firm Gartner. In fact, at least seven outsourcing 'megadeals', worth an estimated aggregate of more than US$20 billion, were signed in the banking and credit industry in 2002.

An important element in many of the megadeals is a focus on IT infrastructure and operations. Many of the mega-outsourcing contracts involve substantial consolidation and centralization of IT assets on a global basis, says Susan Cournoyer, principal analyst for Gartner's IT Services group. Yet the outsourcing megadeals also represent a look ahead. Outsourcing providers promise to meet IT and business needs through new technology...

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