There are several important reasons why financial institutions outsource the gold loan process. One main benefit of outsourcing is the reduction in operational costs. External service providers already have experts for gold valuation and the necessary technology in place. This means that financial institutions do not need to invest separately in these areas. Due to conomies of scale, outsourcing companies can provide services at a lower cost, which ultimately benefits the financial institutions.
In today’s fast-paced financial world, financial institutions such as banks and Non-Banking Financial Companies (NBFCs) are adopting new methods to improve their efficiency, reduce costs, and provide better services to their customers. One important and growing concept among these is the Gold Loan Outsourcing Model. In recent days, many financial institutions have approached me for information on this subject. Simply put, outsourcing in the gold loan business refers to delegating some or all of the processes related to gold loans to external experts. This can include various aspects, ranging from the valuation of gold to the disbursement of loans and the collection of repayments...(To continue reading ,click open the magazine)