With the HR department having many responsibilities such as designing perks and benefits and supervising staff performance, the BFSI sector is witnessing growth in recruitment outsourcing, according to experts.
With stringent regulations and intense competition, the process of hunting for the right talent becomes a daunting task for the banking, financial services and insurance (BFSI) sector, TeamLease Services Vice-President (Recruitment Services) Ajay Shah told PTI here.
He added that therefore, to optimise talent acquisition efforts, the sector has started shifting towards outsourcing of hiring.
Recruitment outsourcing is a fast-growing industry in India and is projected to see an annual growth of 25-35 per cent, he said adding that going by the current trends, more than 70 per cent of the country's employers are likely to outsource all or part of their hiring process in the next five years.
Moreover, he said that as the human resource (HR) department shoulders many important responsibilities like postings or transfer, training programmes, supervising promotions, designing perks and benefits, disbursal of retirement benefits, supervising the performance of staff, and implementing effective HR policies, the recruitment outsourcing process has become vital for the BFSI sector.
Echoing a similar view, Michael Page India Director Nitin John Abraham said large-scale volume requirements that tend to be siloed function-wise gave a boom to the outsourcing of the recruitment process.
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"Outsourcing of the hiring process is expected to grow as it is a very cost-effective solution for large-scale volume appointments. Also, especially in the Indian market, where you have a lot of issues in terms of candidates backing out, taking multiple offers, it does require a dedicated person or group of people to manage the hiring process," he added.
CIEL HR Services CEO Aditya Narayan Mishra said the outsourcing trend is not only being adopted by the BFSI sector, but also by information technology, consumer products, services, manufacturing and pharmaceutical sectors.
"Many BFSI companies have limited their HR teams to strategic work of talent acquisition such as workforce planning while the execution of these plans are assigned typically to a leader for talent acquisition (TA). This TA leader usually has a small team to execute the hiring process and they usually outsource it," he added.
Executive search organisation GlobalHunt Managing Director Sunil Goel said the outsourcing of hiring is growing because of fluctuating talent demand in the BFSI sector.
"During April to September, maximum number of hiring takes place in the BFSI sector. The spike in demand for resources makes the organisation to recruit specialised teams and outsource support from vendors having diverse knowledge and are fast," he said.
Other sectors, such as IT, IT-enabled services, and new-age start-ups are also looking up to this concept of recruitment to manage hiring challenges, he added.