Financial-Service Firms Ignore Cross-Selling, Examine Offshoring - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IT Leadership // IT Strategy

Financial-Service Firms Ignore Cross-Selling, Examine Offshoring

A pair of new reports indicates that financial-services firms are too timid when cross-selling online and perhaps too aggressive in budgeting offshore savings.

A pair of new reports indicates that financial-services firms are too timid when cross-selling online and perhaps too aggressive in budgeting offshore savings.

According to Nielsen/NetRatings, people tend to have blinders on when they perform online financial transactions. For example, they transfer funds among their bank accounts, but then they log off from their financial-services firm's site without being prompted to make a securities trade at the site. The Nielsen/NetRatings report says financial-services firms are leaving money on the table by not trying hard to cross-sell online.

Mortgage transactions tracked highest for cross-sell opportunities: of 4.5 million customers performing mortgage transactions online, 68% performed online-banking transactions and 39% credit transactions.

Of 28 million customers who performed credit-account transactions online, only 28% performed banking transactions, 6% performed mortgage transactions, and 2% online trades, according to the survey.

Of 25 million customers who performed online-banking transactions, only 31% performed credit-account transactions, 12% performed mortgage transactions, and 4% online trades.

On the offshoring front, a study by market-analyst firm TowerGroup says that mortgage companies can shave 6% off the cost of originating a loan by moving business processes to India and other countries.

TowerGroup analyst Craig Focardi says claims of about 25% to 50% savings through offshore outsourcing are unrealistic. Such claims fail to take into account the cost of starting an offshore operation and performing quality control remotely. In trying to control costs, he says, mortgage firms need to look at alternatives, including outsourcing closer to home, business-process reengineering, and domestic call-center relocation.

Those that do send work offshore, TowerGroup says, are outsourcing only basic processes, such as data entry, document and data verification, and quality control. Portions of loan services, such as basic customer service and collections, also are going overseas.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
InformationWeek Is Getting an Upgrade!

Find out more about our plans to improve the look, functionality, and performance of the InformationWeek site in the coming months.

IT Leadership: 10 Ways to Unleash Enterprise Innovation
Lisa Morgan, Freelance Writer,  6/8/2021
Preparing for the Upcoming Quantum Computing Revolution
John Edwards, Technology Journalist & Author,  6/3/2021
How SolarWinds Changed Cybersecurity Leadership's Priorities
Jessica Davis, Senior Editor, Enterprise Apps,  5/26/2021
White Papers
Register for InformationWeek Newsletters
Current Issue
Planning Your Digital Transformation Roadmap
Download this report to learn about the latest technologies and best practices or ensuring a successful transition from outdated business transformation tactics.
Flash Poll