The last economical recession forced the businesses to seek measures to optimise activity, non-traditional ways to cut expenditure, and more efficient solutions to introduce the products and services to the market. Both global corporations and smaller local companies turned back to outsourcing. And the new ways of payment should stir this market even more.

Banks and other financial institutions have been relying on rather conservative policy of outsourcing. However, global economical processes forced this sector to change: to focus on the main activity (lending and deposit collection) and entrust many other activities to external companies.

For instance, in most of the developed countries, the networks of ATMs and credit card terminals are managed not by banks, but by specialised companies. They have more experience and specialists of appropriate qualification to pursue this activity at the lowest possible cost.

“In Lithuania, like in many other countries, in the shopping centres there are three or four ATMs of different banks. Maintaining those costs a lot of money and the load of the machines is far from maximal. Therefore, it would be much cheaper to keep one or two ATMs and thus increase their load (more operations will be performed) and reduce maintenance expenditure,” said Vladas Lapinskas, the Executive Director for the company Penkiu Kontinentu Bankines Technologijos (BS/2).

According to Mr. Lapinskas, in such countries as Finland, all ATMs have been connected to a common network. The people do not have to look for “their” ATM, where the operations would be cheaper, and the banks spend less on network upkeep. It was estimated that due to this reason, average load of a machine in Finland is up to five times larger than in Lithuania, and the cost of one operation is as much lower.

The path similar to Finland’s was also taken by Sweden and other European countries; the first steps have been made by Lithuania as well (two banks used to provide equal conditions for operations in the ATMs; recently four more banks have joined their networks).

Outsourcing by instalments

“Modern hardware and software and qualified specialists help to save, but it also costs a lot. The banks having experienced significant financial loss, refrain from such investments and thus a vicious circle is created: with few investments it is difficult to achieve higher quality results,” said Mr. Lapinskas.

Due to this reason, the company held by Penki Kontinentai Group presented a new solution to its customers – Lithuanian and foreign banks: rent or lease of outsourcing.

“We offer obtaining all our hardware or software solutions as well as the solutions of Wincor Nixdorf represented by BS/2 under completely different conditions that do not require a large lump investment,” explained Mr. Lapinskas.

According to Mr. Lapinskas, banks get economical benefit from such cooperation. For instance, having invested five litas, the banks receive the measures, which allow saving ten litas or earning them from additional services.

BS/2 provides the conditions to the banks and other financial institutions to obtain by rent or lease not only ATMs, but also specialised software, the entire IT infrastructure, and the services of qualified specialists. Naturally, the trust of banks and respective data security are necessary.

“Long-term cooperation with large foreign banks indicates that the partners trust us. And the new partners should be at leased partially reassured by the fact that the companies of Penki Kontinentai were awarded the highest level international data security certificate PCI DSS, and the standards PA DSS, ITIL and ISO 20 000 will soon be introduced,” said the Head of BS/2.

The advantages outweigh the shortcomings

According to the specialist, probably the major difficulty related to introducing outsourcing is psychological.

“It can be compared to the situation when someone suggests giving up the old, own car and starting using a modern and multifunctional one, which will not belong to you, but will allow doing much more,” explained Mr. Lapinskas.

Moreover, in the longer term the outsourcing can be more expensive. However, if you purchase a new apartment for instalments, you pay not only the price of the apartment, but also the interest for the credit.

According to Mr. Lapinskas, outsourcing is sometimes avoided because of the fear to give up old and usual infrastructure.

“It is questioned how new systems suggested by an external company would be installed. Today installation of different IT systems is much simpler and faster than some time ago. Therefore, this factor should not be feared,” said the specialist.

According to Mr. Lapinskas, the potential shortcomings of introducing outsourcing are completely outweighed by their advantages. First, it is the optimisation of activity and related economical benefit. Predominance of the service sector in the Western countries indicates that companies tend to specialise in narrower fields and transfer secondary functions to the specialists of the respective fields.