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South Africa Business Process Outsourcing Market Size, Share & Trends Analysis Report By the Service (Customer Services, Finance & Accounting) And By End-Use (BFSI, IT & Telecommunications) and Segment Forecasts, 2020 to 2027

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This South Africa business process outsourcing market size was estimated at USD 1.4 billion as of the year 2019 and is predicted to expand at a compound annual growth speed (CAGR) that is 13.2% from 2020 to 2027. The growth in the market is driven by technological advancements, constant innovation, and growing competitiveness, which is expected to continue over the next few years. The need to manage operating costs, integrate processes, concentrate on core competencies, and employ qualified talent is anticipated to drive the market over the coming years. South Africa has been home to numerous call center operations for the last few years and has hence garnered global recognition as a top and reliable offshore outsourcing location.

It is also one of the leading destinations in the world for Global Business Services – or offshoring business processes. A high level of expertise, a huge talent pool, lower costs and easy-to-understand English accents are a few of the primary reasons motivating companies to look at South Africa among their preferred outsourcing destinations. With a focus on analytical and Artificial Intelligence (AI)-driven solutions, South Africa has a larger number of actuarial resources than India and provides support in several languages, including French in addition to Spanish. The application to use Artificial Intelligence (AI) and robotics as an alternative strategy for human resources management could also assist incumbents of this South Africa BPO industry in competition with competitors in Europe and the Middle East & Africa.

This, in turn, is likely to boost market’s growth in the near future. In addition, Business Process Enabling South Africa, an industry body for the Best African BPO company industry body has played a major part in encouraging the industry’s growth by helping to develop skills by sharing best practices and providing its members with connectivity to different business organizations & associations that help drive its transition to the digital age. In addition, it is worth noting that the South African government has introduced various tax incentives as well as schemes for the creation of infrastructure and skill-related support. One of them involves the Monyetla Work Readiness Programme.

The major goal of this program is increasing the pool of employable entry-level personnel. By utilizing through the Monyetla Work Readiness Programme, BPO employers lead a collaboration approach to hire and train entry-level staff. This type of initiative is creating young jobs and contributing to the region’s export earnings through offshoring. A BPO sector in SA is growing constantly and is bringing new opportunities for employment which in turn play a major contribution to the region’s growth. Outsourcing service providers believe the fact that South Africa enjoys better opportunities as compared to other countries in Africa to provide Business outsourcing solutions. Cape Town has particularly emerged as an ideal BPO location that is a preferred destination.

Service Insights

The customer support segment was dominant in the market with a market share of over 31% in 2019 and is projected to grow with the fastest growth rate from 220-2027. The reason for this is the increasing number of service centers that require tech support that is available online as well as offline. Customer service BPOs are focused on handling inquiries from customers through phone, chat, email or social media platforms and other channels. The customer service BPO industry is flourishing within Cape Town and has risen dramatically in recent years and is expected to see significant growth in the next few years. Additionally, South Africa holds an advantage when it comes to client service BPO services. The ability to assist companies reduce costs, along with the rapid shift to remote work operations owing to the Covid-19 epidemic has earned customers in South Africa’s service centres an edge over other hubs.

The finance and accounting sector is expected to grow at a substantial growth rate of 13.6% over the forecasted period. The advantages of finance and accounting BPO services in the reduced cost for financial tasks is also driving their adoption across various financial institutions across the country. South Africa is steadily advancing in international service delivery to the financial industry. Several financial organizations are also increasingly settling on South Africa for establishing their African back-office shared services hubs as component of their international delivery systems.

End-use Insights

The IT and Telecommunication segment took the lead in the regional market, by capturing more than 35% in 2019. The telecommunication and IT sectors is among the major adopters of BPO services. In the IT sector, South Africa has performed an essential role in the realm of technical helpdesk and service desk because of its excellent voice skills. In addition, the nation is composed with a high percentage of IT graduates who have the required technical capabilities, which makes it easier to reduce the burden and the expense of training on the part of businesses. South Africa continues to remain one of the leading locations for outsourcing IT services thanks to the fast-growing cluster of companies. These companies provide IT-focused solutions to several industry verticals in the form of websites’ architecture and development and applications and platform development. The growing ICT spending in the nation for the regular maintenance of communications and IT systems in place as well as the replacement of outdated systems are likely to drive the market’s growth.

This BFSI segment is anticipated to register the maximum CAGR during the forecast time. The accessibility of a highly skilled workforce, which includes Chartered Financial Analysts (CFAs), Chartered Accountants (CAs) and actuaries, has been the primary driver for success for the country in this sector. Moreover, global banks are increasingly choosing South Africa for the delivery of intricate banking, for example, life insurance and fund accounting. The country offers a vast array of voice processes within the insurance sector and banking, including commission handling claims processing, and policy administration.

Key Companies and Research on Share of Market

The market is highly competitive as most of the major companies are working on expanding their market reach by implementing various business strategies including partnerships, mergers & acquisitions, and product development. These strategies assist companies in expanding their business geographically and enhance their offerings across the local and international markets. For instance, in July 2020 WNS (Holdings) Ltd introduced EXPIRIUS which is a distinctive customers’ experience (CX) solution that integrates human-assisted designs with AI-driven conversational data to improve customer experience. Some of the major players operating across South Africa’s South Africa business process outsourcing market include:

  • Accenture Plc

  • Amdocs

  • Capgemini

  • HCL Technologies Ltd.

  • IBM Corp.

  • Infosys Ltd. (Infosys BPM)

  • NCR Corp.

  • Sodexo

  • TTEC Holdings, Inc.

  • Wipro Ltd.

  • Mango5 BPO

  • Indox (PTY) Ltd.

  • Outworx Contact Centre

  • SA Commercial

  • Talksure Group

  • Boomerang Marketing

  • iContactbpo

  • 121 BPO Services

  • Altron

  • The IT Guys

  • Merchants SA (Pty) Ltd.

  • CCI South Africa

  • Capita plc

  • Digicall Group

  • DSG Group

  • Startek

  • WNS (Holdings) Ltd.

  • Webhelp

  • O’Keeffe & Swartz

  • Ignition Group

  • Rewardsco

  • Teleperformance SE

  • Encore Capital Group

  • Pra Group, Inc.

  • Paschoalotto Logo

  • Pioneer Credit

  • Credit Corp Group

  • Collection House Ltd.

Segments Covered by the Report

This report anticipates revenue growth at the national level as well as a review of new trends in the business between 2016 and 2027 in every sub-segment. For the purpose of this research, Grand View Research has broken down the South Africa business process outsourcing market report based on the service and the end-user:

  • Service Outlook (Revenue, USD Million from 2016 to 2027)

    • Finance & Accounting

    • Human Resources

    • Knowledge Process Outsourcing (KPO)

    • Procurement and Supply Chain

    • Customer Services

    • Other

  • End-use Outlook (Revenue, USD Million 2016, 2016 – 2027)

    • Banking, Financial Services, and Insurance (BFSI)

    • Healthcare

    • Manufacturing

    • IT & Telecommunication

    • Retail

    • Others