Global Banking BPS Market Overview:
Banking BPS Market Size was estimated at 201.74 (USD Billion) in 2022. The Banking BPS Market is expected to grow from 214.39 (USD Billion) in 2023 to 370.6 (USD Billion) by 2032. The Banking BPS Market CAGR (growth rate) is expected to be around 6.27% during the forecast period (2024 - 2032).
Key Banking BPS Market Trends Highlighted
The Banking Business Process Services (BPS) market is experiencing significant growth driven by the increasing adoption of digital banking, regulatory compliance requirements, and cost reduction initiatives.
The demand for specialized banking services such as transaction processing, customer support, and analytics is growing as banks focus on enhancing customer experience and operational efficiency.
The rise of cloud computing and artificial intelligence (AI) presents opportunities for BPS providers to offer innovative solutions and enhance their service offerings. Cloud-based BPS platforms enable banks to scale their operations seamlessly, reduce infrastructure investments, and access advanced technologies.
AI-powered solutions, such as automated processes and fraud detection, can improve accuracy, reduce costs, and enhance customer satisfaction.
Recent trends in the Banking BPS market include the growing adoption of robotic process automation (RPA) and machine learning (ML) to streamline processes and improve decision-making.
The demand for integrated solutions that combine multiple services into a single platform is also increasing, allowing banks to consolidate their vendor relationships and achieve better cost efficiency.
Additionally, the focus on data security and regulatory compliance has led to the adoption of robust data protection measures and adherence to industry standards by BPS providers.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Banking BPS Market Drivers
Rapid Adoption of Digital Banking Services and Solutions
The main driver of the Banking BPS Market is the fast-growing adoption of digital banking services and solutions. More and more people use smartphones, tablets, and other mobile devices, moving more and more to mobile banking, online banking, and other digital banking channels.
These channels provide customers with a convenient and genuinely efficient way to manage their finances, and this is the factor that drives the growth of the Banking BPS Market.
Another factor actively contributing to the growth of the Banking BPS Market is the increasing popularity of e-commerce and online payments. Businesses today use online shops and other tools to sell products and services to their customers, and this fact requires them to use banking services to enable online purchases and other similar transactions.
Finally, the introduction of new technologies, such as artificial intelligence, machine learning, and blockchain, made it possible for banks to provide their customers with new digital banking services and solutions, which also drives the growth of the Banking BPS Market.
Increasing Demand for Banking BPS Services from Financial Institutions
Another key driver of the banking BPS market is the increasing demand for banking BPS services from financial institutions. Financial institutions are increasingly using Banking BPS providers to outsource their non-core banking processes, such as customer service, loan processing, and back-office operations.
This allows the financial institutions to focus on their core competencies, such as product development and customer acquisition, while leaving the non-core processes to specialized providers.
Banking BPS providers can offer these services more efficiently and cost-effectively than financial institutions can do in-house, which is driving the growth of the Banking BPS Market. In addition, there are an increasing number of regulatory compliance requirements for financial institutions to meet, which is also driving the demand for Banking BPS services.
Growing Adoption of Cloud-Based Banking BPS Solutions
The increasingly rapid adoption of cloud-based Banking BPS solutions is another factor that drives the growth of the Banking BPS Market. Owing to some factors such as its lower costs, greater flexibility, and quicker time to market, this cloud-based Banking BPS solutions have multiple benefits compared to on-premises solutions.
As with cloud-based solutions, it is also useful for banks to access the technologies and functionalities much more conveniently, which, in turn, drives the growth of the Banking BPS Market.
Moreover, the increasing adoption of cloud-based solutions is also due to the rising requirements in terms of data security and compliance.
Banking BPS Market Segment Insights:
Banking BPS Market Service Type Insights
The segmentation of the Banking BPS Market into five service types includes Banking Process as a Service (BPaaS), Business Process as a Service (BaaS), Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS).
As of 2023, the SaaS segment accounted for the highest market share of 46.2%, and the trend is expected to continue until the end of the forecast period. The dominance of SaaS may generally be attributed to an increasing level of adoption of cloud-based solutions and a growing need for cost-effectiveness and flexibility.
Meanwhile, the BPaaS sector is poised to experience the highest CAGR of 12.4% throughout the period, primarily because of the expanding demand for specialized banking services and the need for cost optimization. Overall, the Banking BPS Market is expected to reach $246.48 billion by 2024, growing from $174.49 billion in 2023.
The recorded CAGR is 9.4% between 2023 and 2032. The rapid growth may be attributed to a variety of factors such as an expanding rate of adoption of digital banking services and a growing level of cloud computing proliferation.
The increasing demand for cost optimization is anticipated to largely drive the market, which is also foreseen to benefit from the increasing level of requirement for regulatory compliance as well as the rising complexity of event management.
Thus, key insights into the service type segment of the market are as follows: SaaS is the dominant segment due to an increasing level of adoption of cloud-based solutions and an expanding need for cost-effectiveness and flexibility. BPaaS is anticipated to experience the fastest growth, with a CAGR of 12.4%.
The market is expected to be largely driven by an expanding rate of adoption of digital banking services and cloud proliferation, as well as a capped need for cost optimization.
Meanwhile, the market is also expected to benefit from the increasing level of requirement for regulatory compliance and an elevated demand for analytics and artificial intelligence.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Banking BPS Market Deployment Model Insights
On-premises, cloud, and hybrid are the segments of the Banking BPS Market based on the deployment model. The cloud segment will demonstrate the highest growth in the upcoming year due to the large number of banks which start using cloud-based solutions.
The cloud delivery model possesses a vast number of advantages for banking organizations, such as the ability to scale their capabilities in accordance with the needs of their customers. In addition, it is the most flexible and cost-effective delivery model.
The on-premises segment will hold a significant market share since many banks still prefer to deploy their IT infrastructure on-site.
The hybrid model will show rather stable growth as banks will implement a combination of cloud-based and on-premises solutions.
Banking BPS Market Vertical Insights
The Industry Vertical segment within the Banking BPS Market is expected to experience significant growth in the coming years. The banking industry accounted for a major share of the market in 2023, with a valuation of around 49.23 billion USD.
This growth is attributed to the increasing adoption of digital banking services and the need for efficient and cost-effective banking operations. The financial services industry is also expected to contribute significantly to the market, with a projected valuation of around 40.44 billion USD in 2023.
The healthcare industry is another key vertical, with a forecasted valuation of approximately 27.28 billion USD in 2023. The increasing use of technology in healthcare and the need for improved patient care are driving the growth in this segment.
Additionally, the government, telecommunications, manufacturing, and retail industries are expected to contribute to the overall market growth in the coming years.
Banking BPS Market Business Size Insights
The Banking BPS Market is segmented by Business Size into Small and Medium-sized Enterprises (SMEs) and Large Enterprises. In 2023, the SME segment accounted for most of the Banking BPS Market revenue, owing to the increasing adoption of Banking BPS solutions by SMEs to improve their operational efficiency and reduce costs.
The Large Enterprises segment is expected to grow at a higher CAGR during the forecast period, driven by the rising demand for advanced Banking BPS solutions to enhance customer experience and streamline business processes.
The Banking BPS Market is expected to reach a value of USD 275.67 billion by 2024, exhibiting a CAGR of 6.78% during the forecast period 2024-2032.
Banking BPS Market Regional Insights
North America is expected to hold the largest market share in the Banking BPS Market during the forecast period. The region's dominance can be attributed to the presence of many financial institutions and a high adoption of technology in the banking sector.
The Banking BPS Market in North America is expected to reach a valuation of USD 102.3 billion by 2024, growing at a CAGR of 6.5%. Europe is another key region in the Banking BPS Market, with a market size of USD 54.1 billion in 2024 and a projected CAGR of 5.9%.
The region's growth is driven by increasing demand for cost-effective and efficient banking services. The Asia-Pacific region is also experiencing significant growth in the Banking BPS Market, with a market size of USD 40.6 billion in 2024 and a projected CAGR of 7.2%.
The region's growth is driven by the increasing number of banking institutions and the growing adoption of digital banking services.
South America and the Middle East and Africa (MEA) regions are also expected to experience growth in the Banking BPS Market, albeit at a slower pace compared to other regions.
The market size in South America is projected to reach USD 15.8 billion by 2024, while the MEA region is expected to reach USD 12.4 billion by the same year.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Banking BPS Market Key Players and Competitive Insights:
Major players in the banking BPS market are improving their capabilities across the value chain of IT services. The Banking BPS Market is undergoing a rapid transformation, with the emergence of new technologies and the changing needs of customers.
Leading Banking BPS Market players are investing heavily in research and development to stay ahead of the competition. The Banking BPS Market development is being driven by the increasing adoption of digital technologies, such as cloud computing, big data, and artificial intelligence.
The Banking BPS Market Competitive Landscape is characterized by the presence of a few large players who account for most of the market share. These players are constantly competing to gain market share by offering innovative products and services.
One of the leading players in the Banking BPS Market is Tcs. Tcs is a provider of IT services, consulting, and business solutions. The company has a strong presence in the Banking BPS Market, and it offers a wide range of services, including core banking, payments, and trade finance.
Tcs has a strong track record of success in the Banking BPS Market, and it has been recognized for its innovation and customer service.
A major competitor to TCS in the Banking BPS Market is Infosys. Infosys is a provider of IT services, consulting, and business solutions. The company has a strong presence in the Banking BPS Market, and it offers a wide range of services, including core banking, payments, and trade finance.
Infosys has a strong track record of success in the Banking BPS Market, and it has been recognized for its innovation and customer service.
Key Companies in the Banking BPS Market Include:
- Atos
- Capgemini
- Genpact
- Steria
- HCL Technologies
- TCS
- Infosys
- Wipro
- ExlService
- Cognizant
- WNS
- Syntel
- Accenture
- IBM
Banking BPS Industry Developments
The increasing adoption of digital banking solutions, rising demand for personalized banking services, and growing regulatory compliance requirements are driving the market growth.
Furthermore, the strategic partnerships between banks and fintech companies to offer innovative banking solutions are expected to fuel market expansion.
The market is witnessing advancements in artificial intelligence (AI) and machine learning (ML), which are being integrated into banking systems to enhance customer experience and operational efficiency. The increasing use of cloud-based banking solutions is also contributing to market growth, as it offers scalability, flexibility, and cost-effectiveness.
Banking BPS Market Segmentation Insights
Banking BPS Market Service Type Outlook
- Banking Process as a Service (BPaaS)
- Business Process as a Service (BaaS)
- Infrastructure as a Service (IaaS)
- Platform as a Service (PaaS)
- Software as a Service (SaaS)
Banking BPS Market Deployment Model Outlook
Banking BPS Market Vertical Outlook
- Banking
- Financial Services
- Healthcare
- Government
- Telecommunications
- Manufacturing
- Retail
Banking BPS Market Business Size Outlook
- Small and Medium-sized Enterprises (SMEs)
- Large Enterprises
Banking BPS Market Regional Outlook
-
North America
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Europe
-
South America
-
Asia-Pacific
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Middle East and Africa
| Report Attribute/Metric |
Details |
| Market Size 2022 |
201.74(USD Billion) |
| Market Size 2023 |
214.39(USD Billion) |
| Market Size 2032 |
370.6(USD Billion) |
| Compound Annual Growth Rate (CAGR) |
6.27% (2024 - 2032) |
| Report Coverage |
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Base Year |
2023 |
| Market Forecast Period |
2024 - 2032 |
| Historical Data |
2019 - 2023 |
| Market Forecast Units |
USD Billion |
| Key Companies Profiled |
Atos, Capgemini, Genpact, Steria, HCL Technologies, TCS, Infosys, Wipro, ExlService, Cognizant, WNS, Syntel, Accenture, IBM |
| Segments Covered |
Service Type, Deployment Model, Industry Vertical, Business Size, Regional |
| Key Market Opportunities |
Digital transformation Cloud adoption.Expansion in emerging markets.Blockchain integration Automation Artificial intelligence adoption |
| Key Market Dynamics |
Increased regulatory compliance.Growing adoption of digital banking.Demand for cost optimization.Rise of fintech and digital disruption Focus on customer experience improvement. |
| Countries Covered |
North America, Europe, APAC, South America, MEA |
Frequently Asked Questions (FAQ) :
The Banking BPS Market was valued at 214.39 billion U.S. Dollars in 2023 and is expected to reach 370.6 Billion U.S. Dollars by 2032, exhibiting a CAGR of 6.27% during the forecast period.
North America currently dominates the Banking BPS Market and is expected to maintain its dominance throughout the forecast period. The region's large banking and financial sector, coupled with the early adoption of advanced technologies, drives its market growth.
Several factors contribute to the growth of the Banking BPS Market, including increasing demand for cost-effective banking solutions, growing adoption of digital banking services, and the need for enhanced operational efficiency. Additionally, favorable government regulations and the rise of fintech companies further fuel market expansion.
The Banking BPS Market is highly competitive, with several established players and emerging companies. Some of the key players include Infosys, TCS, Accenture, IBM, Cognizant, Genpact, Wipro, HCL Technologies, and Capgemini.
Banking BPS finds applications across various banking operations, including transaction processing, customer service, data management, risk management, and compliance. By leveraging BPS, banks can improve their operational efficiency, reduce costs, and enhance customer satisfaction.
The Banking BPS Market faces certain challenges, such as data security concerns, regulatory complexities, and the need for continuous innovation to keep pace with evolving technologies. Additionally, competition from in-house banking operations and the emergence of new technologies can pose challenges to market growth.
The Banking BPS Market is witnessing several emerging trends, including the adoption of cloud-based BPS solutions, the integration of artificial intelligence and machine learning, the rise of robotic process automation (RPA), and the increasing focus on data analytics for improved decision-making.
The future of the Banking BPS Market appears promising, with continued growth expected in the coming years. The increasing adoption of digital banking, the need for cost optimization, and the growing demand for enhanced customer experiences will drive market expansion. Furthermore, advancements in technology and the emergence of new business models will create new opportunities for growth.
Businesses can leverage Banking BPS to gain a competitive advantage by improving operational efficiency, reducing costs, and enhancing customer satisfaction. By outsourcing non-core banking functions to a BPS provider, businesses can focus on their core competencies and strategic initiatives. Additionally, BPS providers can offer specialized expertise, economies of scale, and access to advanced technologies, enabling businesses to stay competitive in the rapidly evolving banking landscape.
The Banking BPS Market is subject to various regulations aimed at ensuring data security, consumer protection, and financial stability. These regulations include the Gramm-Leach-Bliley Act (GLBA) in the United States, the General Data Protection Regulation (GDPR) in the European Union, and the Personal Data Protection Act (PDPA) in Singapore. Compliance with these regulations is crucial for BPS providers to operate effectively and maintain customer trust.
