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Even as the IT and ITES industries are staggering under the impact of the subprime crisis and the resultant dip in the dollar, many BPOs are ramping up operations to tackle new demands in account receivables management (ARM). Business process outsourcing (BPO) firms like Aegis BPO, Firstsource, Zenta, HOV Services and others have been receiving leads and inquiries from current and new clients towards updating their ARM business. ARM includes services like invoice generation, lockbox/remittance processing, cash application/reconciliation, notice presentment, first party collections, delinquency management and bad debt purchase. Ananda Mukerji, managing director and chief executive of Firstsource, explains the logic behind this flurry of activity, "At one level, as overall delinquencies increase, what we expect to happen is that the portfolio of debt, on which collections are to be done, will increase. So, all the issuers of financial instruments will have more debtors from whom they need to collect, therefore, the volume of business available should increase. We should get larger shares of business going forward. But that is something which will happen over a period of time."
According to Zenta country manager Jaswinder Ghumman, "While the negative impact of the sub-prime issue is evident and seen, its other impact will be on the clients who will be under pressure to cut costs. Clients have been talking about the volumes of work on the collection side. We do see a clear mandate of these services increasing both from existing as well as new clients." |
