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

In the South Africa business process outsourcing market size was estimated at USD 1.4 billion in the year 2019 and is predicted to expand by a compound annual growth rate (CAGR) which is 13.2% from 2020 to 2027. The market’s growth is led through technological advances, continued innovation, and intensifying market competition. This trend is expected to persist over the next few years. The need to control the cost of operations, improve processes, concentrate on core competencies, and employ qualified talent is expected to propel this market over the next years. South Africa has been home to numerous call center operations for the past several years and has since gained international recognition as a popular and reliable offshore outsourcing destination.

It is also ranked as one of the top countries that offer Global Business Services – or outsourcing business processes. The right expertise, a massive talent pool, lower expenses as well as easy-to understand neutral English accents are some of the main reasons driving companies to consider South Africa among their preferred outsourcing destinations. With the emphasis on data analytics, as well as Artificial Intelligence (AI)-driven solutions, South Africa has a larger number of actuarial resources as when compared to India and is able to provide support in a variety of languages, including French as well as Spanish. The utilization and application of artificial intelligence and robotics as a method of complementing for human resources management can aid incumbents of this South Africa BPO industry in competition with competitors in Europe and the Middle East & Africa.

This will, in turn, be expected to propel market’s growth in the near future. Additionally, Business Process Enabling South Africa, an industry body for the African Business Process Outsourcing industry body is playing a key role in encouraging the sector’s expansion by assisting in the development of skills by sharing best practices and offering its members connections to business networking networks & associations that are driving and influencing the sector’s transition into the new economy of digital. Additionally to this, The South African government has introduced various tax incentives and programs for the development of infrastructure and skills-related support. One of the most well-known initiatives include monyetla, which is the Monyetla Work Readiness Program.

The main goal of this program is the expansion of the quantity of employed entry-level personnel. With it’s Monyetla Work Readiness Program, BPO employers lead a group approach to recruit and train entry-level employees. These initiatives provide young people with employment opportunities and contribute in the region’s export income from offshoring. There is a afribpo industry in SA is growing at a rapid pace creating new job opportunities, subsequently playing a decisive role in the region’s economic growth. Outsourcing service providers believe that South Africa enjoys better opportunities when compared to other nations in Africa to offer business outsourcing services. Cape Town has particularly emerged as an ideal BPO location preferred by BPO providers.

Services Insights

The customer service segment was the largest in the market with a share exceeding 31% in 2019 and will expand further with the fastest growth rate from 220 until 2027. The reason for this is the increasing number of service centers that require the availability of technical support online and offline. Customer service BPOs are devoted to handling customer queries generated through email, chat, phones as well as social media platforms as well as other channels. Customers can contact them via chat, email, social media platforms and other channels. BPO industry is thriving across Cape Town and has risen considerably over the last few years and is likely to witness significant growth in the next few years. In addition, South Africa holds an advantage when it comes to client service BPO services. The capability to help companies reduce costs, along with the rapid shift to remote operations due the Covid-19 pandemic has earned the customer services centers of South Africa an advantage over other hubs.

The finance and accounting segment will grow at a substantial growth rate of 13.6 percent during the forecast period. The benefits of finance and accounting BPO services in efficiency of the finance functions is also driving their adoption throughout a number of financial institutions in the country. South Africa is steadily advancing in the area of international services to the industry of financial services. A number of financial institutions are slowly embracing South Africa for establishing their African back-office shared services hubs to be part of their global delivery networks.

End-of-use Insights

The IT and telecommunications segment was the dominant market in the region with a share of more than 35% in 2019. The telecommunications and IT sector is one of the most prominent adopters of BPO services. In the IT area, South Africa has performed a vital role in the field of the technical helpdesk and service desk because of its remarkable ability to communicate. Furthermore, the country is made up in a huge number of IT graduates who have the appropriate technical abilities, which, in turn, reduces the responsibility as well as the cost of training for companies. South Africa continues to remain one of the leading locations for outsourcing IT services owing to the rapidly growing cluster of companies. They offer IT-based solutions to various industry verticals in the form of website architecture and development, and platforms and application development. The growing ICT spending in the nation for the regular maintenance of the communications and IT systems in place and the replacement of outdated systems are likely to drive the expansion of this segment.

This BFSI segment is anticipated to show the highest growth during the forecast time. Its easy access to qualified workforce, comprising Chartered Financial Analysts (CFAs), Chartered Accountants (CAs), and actuaries, has been the key driver behind success for the country in this sector. In addition, global banks are turning to South Africa for the delivery of complex work in banking and finance, including life insurance and fund accounting. The country is also able to provide a large number of voice services for insurance, including commission handling, claims processing, as well as policy administration.

Key Companies and Research on Share of Market

The market is highly competitive as most of the major companies are concentrating on enhancing their market position through various strategies for business including mergers and acquisitions, partnerships as well as product development. These strategies can help companies expand their operations geographically and improve their offerings across the local and international markets. For instance, in July 2020 WNS (Holdings) Ltd released EXPIRIUS, a unique client experience (CX) solution that integrates human-driven designs and AI-driven conversational information to enhance customer experiences. Some of the biggest players within the 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 included in the Report

This report forecasts revenue growth at the country levels and provides an analysis of the current trends in the industry from 2016 to 2027 across the various sub-segments. For the purpose of this study, Grand View Research has subdivided in the South Africa business process outsourcing market report based on services and their end-uses:

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

    • Finance & Accounting

    • Human Resources

    • Knowledge Process Outsourcing (KPO)

    • Supply Chain & Procurement

    • Customer Services

    • Others

  • End-use Outlook (Revenue USD Million Between 2016 and 2027)

    • Banking, Financial Services, and Insurance (BFSI)

    • Healthcare

    • Manufacturing

    • IT & Telecommunication

    • Retail

    • Others

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