Advantages of outsourcing is reducing operational costs. External service providers already have experts for gold valuation and the necessary technology in place. As a result, financial institutions do not need to invest independently in these resources. Due to economies of scale, outsourcing companies can provide services at a lower cost, which ultimately benefits the financial institutions. Expenses related to employee salaries, training, and other infrastructure are saved, while a larger portfolio of loans can be disbursed in a shorter time.
In today’s fast-paced financial world, banks and non-banking financial companies (NBFCs) are increasingly adopting innovative methods to improve efficiency, reduce costs, and provide better services to their customers. One such important and growing concept is the Gold Loan Outsourcing Model. Recently, several financial institutions have sought my guidance on this topic. Simply put, outsourcing in the gold loan business involves delegating some or all of the processes related to gold loans to external experts. This can include a wide range of activities, from the valuation of gold to the disbursal of loans and their recovery....(To continue, open the magazine)