Death knell for some smaller BPOs?
By Sameer

The IRDA (Insurance Regulatory and Development Authority of India) may mandate that all life insurance telesales have to be supported by a backed up audio conversation record by the telemarketer i.e. a record of conversations held leading to the sale. According to a Tipster, this will possibly mean the death knell for smaller BPOs who do not have phone recording capabilities.

Many smaller Indian BPO’s have daily dial out sheets for tele calling for life insurance telesales made from their center.

Smaller Direct Sales Agencies and channels too will be out of business if they do not adopt latest call recording/archival and record location capabilities as being proposed by IRDA.

A minimum capital expenditure of around Rs. 1000 per seat and operating expenses of Rs 3000 per seat per month for IT staff, servers etc is required. Most smaller companies do not have the resources to raise the finances for this additional investment being proposed by the IRDA.

Most will have to automate, get in Computers, LAN, servers, authentication servers and most expensive of all is the telecom switch which helps to integrate your call center to the telephone line coming from the provider. Additionally, telecalling at these smaller outfits may stop, and till the time they cannot incorporate new technology as such things takes month to implement, may be forced to stop business.

As of now the IRDA has not been specific on the timelines. However, if compelled by the IRDA, the insurance companies would have to provide the recordings from their telemarketing vendors.

Might be there even would be a shift to more organised BPOs in the short term by life insurance companies due to this legislation, as the smaller BPOs or lower capitalized ones may not have the funds to invest.

This would again mean shift to better jobs from DSAs/DSCs to organised BPOs such as Andromeda, FirstSource, Aegis BPO, Hinduja Global etc.