Finance And Accounting Business Process Outsourcing Market Size, Share & Trends Analysis Report By Service, By Enterprise-size, By Vertical, By Region, And Segment Forecasts, 2023 - 2030

Report Overview

The global finance and accounting business process outsourcing market was valued at USD 56.42 billion in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 9.1% from 2023 to 2030. The growth can be attributed to the increasing demand for reliable and cost-effective services with advanced technologies, and the growth of the BPO industry in emerging economies. The impact of COVID-19 led to economic and social disruptions and created challenges in outsourcing functions. However, the changes brought to business activities due to these disruptions are expected to provide impetus to the market in the long run. Finance and accounting (F&A) business process outsourcing (BPO) companies have changed their business models by restructuring their Business Continuity Plans (BCP) to a distributed workforce. Businesses have realized the importance of continuous operations planning and disaster recovery to build a more reliable business model that can survive an unprecedented disruption like the COVID-19 pandemic. 

Infrastructure and operational capabilities are set up by service providers’ basis contractual agreements. In the finance & accounting business process outsourcing industry, the supplier is generally a developing nation where the services or business operations are conducted whereas the buyers are developed economies. Finance & accounting BPO services generally cater to standardized operations to reduce fixed operational expenses such as record to report, insurance claim processing, and account & booking services.

Furthermore, Knowledge Process Outsourcing (KPO) enables organizations to expand operations by assisting at a strategic level, offering consulting services, market intelligence services, and legal services, among others to help make strategic business decisions driving the finance & accounting business process outsourcing industry growth.

Cloud computing, social media marketing services, business analytics, and process automation technologies are increasingly adopted by BPO service providers to improve their business processes and lower operational expenses. Incorporating such technologies in finance & accounting BPO’s operating functions enabled it to provide highly valued services to the clients thereby fulfilling their requirements at affordable costs.

For instance, the inclusion of cloud-based technical support solutions allows finance & accounting BPO vendors to update their CRM service offering greater transparency for customer interactions. These factors would further supplement the growth of the market during the forecast period.

 BPO envisages outsourcing various non-core back-office and front-office functions, including call center operations, IT services, financial services, and recruitment services, among others, to a third party. Outsourcing these functions allows companies to reduce their operational expenses and focus on their core competencies Advances in information and communication technology (ICT) have contributed to the market’s growth.

Further, innovation in ICT coupled with the increasingly fragmented production processes is allowing enterprises to outsource labor-intensive services to countries, such as India & Philippines, to leverage the low-cost labor and the advanced IT infrastructure available in these countries. These aforementioned factors would further drive the market growth during the forecast period.

Outsourcing of financial data related to verticals such as banking, and insurance involves sharing critical details such as income statement, account number, contact details, customer name, and social security number among others with the outsourcer to ensure proper implementation of the business process.

As such, outsourcing companies are often concerned with the way the outsource handle the information shared and are observed to be reluctant as even a small error can result in a permanent setback concerning the company’s market position. Thus, disinclination to outsource business processes on the part of outsourcers is anticipated to significantly hamper the growth of the finance & accounting BPO market.

Service Insights

The Order-to-Cash (O2C) segment accounted for a market share of 54.5% in 2022. Order-to-cash is a set of business operations and activities that include receiving and achieving customer requests for goods and services. It impacts business operations throughout the organization, such as inventory management, supply chain management, and labor.

Further, the company’s cash inflow and working capital are determined by O2C functions. In addition to cash flow improvements, the major advantages of optimizing the O2C process include customer experience, cost savings, and revenue generation. These factors can have a positive impact on O2C segment growth during the forecast period.

The Procure-to-Pay (P2P) segment is anticipated to grow at a CAGR of 9.2%. The segment growth can be attributed to the improvements in digital technology, growing use of e-invoicing solutions, and growing Service as a Service (SaaS)-based P2P suite adoption within organizations. By providing managed services, P2P vendors offer expenditure planning skills and expenditure categorization to allow better planning and strategic sourcing capabilities.

Additionally, increasing the enhancement of P2P solutions various sub-processes can be outsourced as an extra capability with this solution to save company costs. Further, it boosts organizations to gain advanced technologies and skilled employees with reasonable costs, and access to local talent. These benefits would further drive the growth of the P2P segment during the forecast period.

Enterprise-size Insights

The large enterprises segment accounted for a market share of 69.2% in 2022. Large institutions are collaborating with numerous BPO service providers for improved cost efficiency and ease of customer management across various regions. Further, BPO allows large organizations to refocus on their core business activities to deliver incremental value to their customers.

For instance, Wipro is one of the pioneers in offering human resources, customer management services, and finance and accounting services. The company’s HR services include workforce administration, compensation benefits, payroll processing, and performance management services. These services are offered, to benefit organizations for cost optimization, and improve business functions. These factors would further drive the demand for BPO services across large enterprises during the forecast period.

The Small & Medium Enterprises (SMEs) segment is anticipated to grow at a CAGR of 8.5%. Finance & accounting BPO has provided SMEs with the means to increase profits and cut costs efficiently. Small businesses are also encouraged by the advantages obtained through innovative technologies such as cloud computing, process automation, and social media, among others.

With the increased impact of these technologies, finance & accounting BPOs can enhance the efficiency of their services even further. Further, BPO service providers are also expected to use new technological innovations to efficiently enhance products, manage talent shortages, and services, and address market challenges while keeping operating costs low. These factors would further drive the demand for BPO services across small & medium enterprises during the forecast period.

Vertical Insights

The BFSI segment accounted for the largest revenue share of 21.1% in 2022. BPO is an essential part of the BFSI business models catering to various domains of the financial sector including phone banking, customer service, asset management, and investment management, among others. The growing digitization of services in the BFSI industry and increasing focus on personalized services have led to the need for service providers to optimize data management, enhance customer value, and enhance cross-selling opportunities. This has led to increased adoption of financial & accounting BPO services in the BFSI industry and is anticipated to drive growth over the forecast period.

The IT & telecom segment is expected to register a significant growth of 10.2% from 2023 to 2030. Companies engaging in BPO can choose to outsource specific services or business functions based on their distinctive requirements. These services include procure-to-pay, order-to-cash, and record-to-report. For instance, Capgemini is one of the pioneers engaged in offering finance & accounting services. The company’s finance & accounting service includes order-to-cash, record-to-report, procure-to-pay, and source-to-pay. These factors have resulted in the demand for finance & accounting BPO services in the IT & telecom sector during the forecast period.

Regional Insights

North America held the major share of 36.4% in 2022 of the global F&A BPO market. The region is expected to retain its dominance due to the rising demand for business process outsourcing services owing to lower costs, higher efficiency, global expansion, and focus on core business functions.

For instance, in May 2022, Fiserv, Inc., a U.S.-based company, announced a partnership with SunStream Business Services (St. Paul, Minnesota), a fintech service corporation. The latter company will utilize Fiserv’s financial accounting for DNA as its core loan accounting platform to handle loan portfolios and offer flexibility and ease of integration. These developments would further drive regional growth.

Asia Pacific is anticipated to emerge as the fastest-growing region over the forecast period at a CAGR of 10.4%. The regional growth can be attributed to the Increasing demand for talented professionals, reduced labor costs, and significant digital investment by leading vendors such as Infosys Ltd, Accenture, HCL Technologies Ltd, and Wipro. Moreover, significant infrastructure investments from government bodies are expected to provide growth opportunities for enhancing the F& A BPO ecosystems in the Asia Pacific region.

For instance, in September 2018, Wipro Limited signed a partnership agreement with Mercury Network. The agreement would enable Wipro Limited and Mercury Network to jointly provide an appraisal management platform, which is integrated with Wipro Limited’s NetOxygen loan originating system for financial services customers. These developments would further drive the growth of the region during the forecast period.

Key Companies & Market Share Insights

The dominant players operating in the F&A business process outsourcing market include Accenture; Infosys Limited (Infosys BPM).; HCL Technologies Limited; Capgemini; and IBM Corporation. Market players are observed to invest resources in research & development activities to support growth and enhance their internal business operations.

The report will include company analysis based on their financial performances, product benchmarking, key business strategies, and recent strategic alliances. Companies can be seen engaging in mergers & acquisitions and partnerships to further upgrade their products and gain a competitive advantage in the market. They are effectively working on new product development, and enhancement of existing products to acquire new customers and capture more market shares.

For instance, in February 2021, Genpact announced a partnership with Massmart (Africa), a leading retailer, to transform its financial operations and leverage analytics and digital technology to drive the competitive growth of Massmart. The former company will manage and change the financial and accounting services of Massmart, including accounts receivable, payable, and defined activities in financial tax, control, treasury, and perform financial analysis. Some prominent players in the global finance and accounting business process outsourcing market include:

• Accenture

• Infosys Limited (Infosys BPM)

• HCL Technologies Limited

• Wipro Limited

• Capgemini

• Sutherland

• IBM Corporation

• Tata Consultancy Services Limited

• Genpact

• Fiserv, Inc.

Finance And Accounting Business Process Outsourcing Market Report Scope

Global Finance And Accounting Business Process Outsourcing Market Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global financial & accounting business process outsourcing market report based on service, enterprise size, vertical, and region:

• Service Outlook (Revenue, USD Billion, 2018 - 2030)

  • Order-to-cash

  • Procure-to-pay

  • Record-to-report

  • Source-to-pay

  • Multi Processed

• Enterprise-size Outlook (Revenue, USD Billion, 2018 - 2030)

  • Small & Medium Enterprises (SMEs)

  • Large Enterprises

• Vertical Outlook (Revenue, USD Billion, 2018 - 2030)

  • BFSI

  • Healthcare

  • Manufacturing

  • Energy & Utilities

  • Travel & Logistics

  • IT & Telecommunications

  • Media & Entertainment

  • Retail

  • Others

• Regional Outlook (Revenue, USD Billion; 2018 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

  • Asia Pacific

    • China

    • India

    • Japan

    • Singapore

    • Malaysia

    • Philippines

    • Indonesia

    • Thailand

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa (MEA)