FintechTechnology

How fintechs work with outsourced customer service providers to meet demand

Scaling may mean outsourcing customer service interactions, but learning how and when to collaborate with in-house team members is key, executives say

For new, fast-growing fintechs, mastering the user experience and refining product capabilities can be a significant investment. The challenge is that financial services customers also demand a seamless customer service experience. According to a survey by enterprise contact center platform Talkdesk last year, two-thirds of the nearly 900 consumers polled said one bad customer experience “dilutes brand loyalty.”

As fintechs tackle the evolution of product roadmaps and strive to nurture trust through customer service, a growing number are partnering with business process outsourcing (BPO) companies. In many cases, client service agents offered through these partners are located overseas, amplifying the pressure on companies to stay true to their customer-service promises. 

The market for BPO is growing fast, across various industries. Grandview Research estimates that the global business process outsourcing market size was valued at $232.32 billion in 2020 and is expected to register a compound annual growth rate (CAGR) of 8.5% from 2021 to 2028. Within the field, a sector of BPO providers that serve fintechs are growing quickly.

In October, New York-based BPO company Ubiquity confirmed a strategic investment from BV Investment Partners, valuing the company at $325 million before the investment. Meanwhile, TaskUs, a Texas-based BPO provider which serves large tech firms, including Uber, Netflix, Coinbase and Zoom, went public in June. 

Many financial services and fintech firms – including BM Technologies, Green Dot, Propel, Mobility Capital Finance (MoCaFi), and others – are outsourcing at least some of their client-service functions to keep pace with demand. BPO providers can handle a range of customer-facing interactions, including phone, email and messaging. BPO providers that work with fintechs can also handle identity verification, fraud mitigation and investigation, among other client-service functions. 

“It’s more common once an organization has achieved some degree of scale to work with an outsourcing solution provider,” said Matt Nyren, president and CEO of Ubiquity. Fintechs want to work with a BPO provider that has financial-services expertise, along with an economic advantage, he noted.

Aaron Fischer, chief customer officer at Austin-based BPO provider OfficePartners360, and who helped build the fintech practice at TaskUs in a prior role, said fintechs began increasingly working BPO providers from 2012 onwards, as funding for the sector ramped up.

“Fintech companies are brilliant in regards to designing financial services products or solutions. They’re great at building a great go-to-market strategy and a brand and a culture, but they don’t necessarily always have the internal employees or leadership that are customer care and tech support experienced,” he said. In addition, the cost to support these employees can be high in many U.S. cities where fintechs are headquartered, he added.

Fintechs that work with BPOs say they’re able to meet customer-service demands in a timely way by using BPO providers to act as extensions of their teams. Some of these external providers use overseas staff members to field customer service and other inquiries, but fintechs say close collaboration, and sometimes escalating more complicated requests to in-house teams, can usually resolve any issues that arise. 

Kate Gressman, chief customer officer at Propel, a New York-based fintech that offers customers a debit card and an app to view their EBT benefits and bank accounts in one place, has been working with an outsourced customer service provider since April of this year. It uses a “train the trainers” approach, which includes close collaboration between U.S. employees and outsourced client-service agents. Propel has 5 million active customers across all 50 states.

“We partner closely with them for initial training and then we provide recurrent training opportunities to keep the agents fresh with any new processes or limit any knowledge gaps,” she said. “We also partner with them weekly to review the quality of the calls and provide coaching and feedback opportunities so that the agents are getting continued improvement and development.”

Listening to calls is an important way fintechs can ensure outsourced service agents can “speak the brand” and ensure a high standard of service, noted Wole Coaxum, CEO of MoCaFi, a Newark, New Jersey-based fintech firm that caters to the underbanked. MoCaFi partners with an outsourced provider that delivers phone, messaging and dispute-resolution support. Coaxum said executives regularly listen to customer-service calls as a way of ensuring quality control.

“We’ve got weekly meetings. We listen to the calls, we provide feedback [and] we engage with the managers in terms of what needs to be improved upon,” he said.

Fintechs working with BPOs can encounter challenges if the free flow of access to information between the client and partner is obstructed, suggests OfficePartners360’s Fischer. 

“If they only allow their partner access to certain data fields or certain system permissions, or only allow us to handle simple or tier one customer care tickets, then that’s the only value [BPO providers] can add.”

For MoCaFi, a tiered system where complicated inquiries get escalated to in-house staff members is an important way to ensure they’re dealt with efficiently.

“If someone has to have a first level of engagement with somebody that they’re talking to, let’s make that available to them through [BPO partner] Ubiquity, and if Ubiquity finds itself working on things that are challenging, then they can then escalate that up to one of our folks who can work through some of the more complex things.” Complex inquiries, according to Coaxum, can include fraud.

Other fintechs use a hybrid BPO approach, which includes complementing a U.S.-based team with overseas customer service agents offered through a BPO provider. 

Austin-based Self Financial, which offers credit products and tools to help consumers build credit, serves approximately one million active customers. The company said its customer-service agents are 60% in the U.S. and 40% overseas, allowing for close collaboration between the teams.

“You need to have the internal support within your organization and infrastructure and people to really be able to effectively manage [the fintech-BPO] relationship,” said Kina Martin, vice president of customer success at Self Financial. “You can’t expect that you can just ramp up a BPO and toss things over the wall and that it will be a success. You need to be heavily invested in that you want to make sure that you’re driving for the right outcomes for your customers.”

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