Six Risk Management Best Practices Adopted by Third Party Providers and Global In-House Centers
The banking and financial services sector, by virtue of the nature of business, faces a high level of scrutiny with respect to its risk and compliance procedures. This scrutiny is much more intense when they outsource business processes to third party service providers as compared to a Global In-house Center (GIC). Recent high profile incidents of regulatory violations at leading financial institutions have pointed in the direction of outsourcing, the argument being that 'Services can be outsourced but not the risk.' But does the risk of compliance indeed increase with outsourcing? Interestingly the facts based on the analysis indicate the contrary.