Bpos Flock To Rural Areas To Set Up Shop

Rural business process outsourcing (BPO) is catching the fancy of many Indian biggies, with the companies eyeing it more as a business proposition rather than a corporate social responsibility (CSR).
With the telecom industry aiming to increase its rural subscribers base and the central bank asking banks and financial firms to cater to the rural sector, businesses will have to find ways of servicing customers, say analysts. Most of the rural BPOs have a seating capacity of below 100 per centre, as they are situated in remote areas.

Some of the firms that are expanding reach in rural India are Aegis BPO, Comat Technologies, SerWizSol (a Tata enterprise) and GramIT of Byrraju Foundation.

Aegis BPO, an Essar group company, is planning to set up centres in tier-III and IV cities to cater to the rural segment. The company has plans to invest $75 million (over Rs 300 crore) as capital expenditure over the next two years to set up centres in places such as Ranchi, Bhagalpur (Bihar), Durgapur (West Bengal) and Jharkhand.

We are still in talks for opening these centres as we clearly see it as a business opportunity. Absolute value and per unit realisation is less, but percentage profitability is quite high. Also, the cost of setting up a rural BPO is 20-22 per cent lower when compared with urban BPOs, said Aparup Sengupta, MD and CEO, Aegis BPO.

Other than the cost of infrastructure, the salary levels are also 15-20 per cent lower than the urban centres. In some cases, where the centres are located in the interiors, salary levels can be around Rs 3,000-7,000 per month. Attrition rate is also very low.

Agrees Jacob Verghese, chief integrator and lead partner at Byrraju Foundation, Rural BPOs clearly have a cost advantage of 20-25 per cent. The only problem in some cases is infrastructure.

GramIT, the rural BPO initiative by Byrraju, has five centres in coastal regions of Andhra Pradesh. It started off by servicing the Satyam Group, but now has six to seven corporate clients in India. The company provides both voice and transaction services in the ratio of 30:70.

We also plan to get into providing research work and will set up centres in Madhya Pradesh and other states soon. With this, the client base could also jump to 15, Verghese adds.

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