StanChart to assist Scandent BPO operations

Indian outsourcers form unusual alliance

In an unusual alliance in the Indian business process outsourcing (BPO) industry, the Indian BPO subsidiary of Standard Chartered Bank of the U.K. is helping Scandent Solutions set up a practice for the banking industry.

Scope International, the wholly owned BPO subsidiary in Chennai, India, of Standard Chartered, will share a part of its facility as well as its know-how and processes with Cambridge Integrated Services, the BPO arm of Scandent Solutions, said Satyen Patel, executive vice chairman of Scandent Solutions. Scope will also assign some senior managers to the operation, he added.

Scope says the agreement will give the company exposure to other banking BPO markets. Scope want to leverage its experience of over four years in banking BPO, said Sreeram Iyer, chief executive officer of Scope. As a captive operation of Standard Chartered, the company does not get exposure to BPO markets, and this deal also will be an opportunity to assess and set new performance benchmarks for its internal operations, he added.

The tie-up will also help Scope get a new revenue stream, Iyer added.

Cambridge will continue to manage the customer interface and service level agreements and will also hire the operation's staff, Iyer said. The transaction processing staff will be on Cambridge's payroll, he added.

Scope currently does work for Standard Chartered entities worldwide in 56 countries, and handles 80 million transactions per year from its 4,000-staff facility. "The bank saves $80 million per annum as a result of having formed this shared services center," Iyer said.

During the first phase, Scope will provide infrastructure to Cambridge for about 350 seats, growing to 1,000 seats to 1,500 seats in the medium term. "This will help us utilize our assets better as Standard Chartered does not exist in the United States," said Iyer. "Because we do not operate in the nights, we have free capacity available during the nights," Iyer said.

Cambridge is mainly targeting the U.S. and Australian markets for its banking services, Patel said. This deal saves Cambridge on capital expenditure, he added.

For Cambridge, the alliance with Scope gives it an entry to the banking BPO market, with the credibility that the association with Standard Chartered brings, Patel said. "It gives us a strong platform, and a differentiator to offer services in the banking vertical," Patel added. The company is currently very strong in BPO for the insurance sector.

Scandent Solutions, a broad-based IT services company in Singapore, announced last September its merger with Cambridge Services Holdings, the BPO arm in Greenwich, Connecticut, of the Scandent Group. The merged company is to be renamed Cambridge Solutions. Some of Scandent Solution's financial services IT clients are now likely to use the new BPO services as well, Patel added.

Scope's Iyer said that the tie-up with Cambridge was not the beginning of a strategy for the company to get directly into third-party business. "We have our hands full as of now, as Standard Chartered is doing well, growing organically, and making acquisitions," he said.