Why Solutions Aggregators Are Redefining BFSI Outsourcing

Globally, the digital transformation market within banking, financial services, and insurance (BFSI) is projected to grow from approximately USD 93 billion in 2024 to over USD 108 billion in 2025, highlighting the scale and urgency with which institutions are modernizing operations to meet today’s demands. Financial institutions face increased pressure to evolve their operating models to address a range of challenges, including accelerated digital transformation, shrinking profit margins, heightened regulatory scrutiny, and rising customer expectations for superior service. These are forcing institutions to rethink how they source, manage, and deliver services. In this rapidly evolving environment, service providers that position themselves not merely as vendors but as solutions aggregators are emerging as the most valuable partners.

Navigating the Complexity of a Fragmented BFSI Technology Ecosystem

The supporting ecosystem has become highly fragmented as BFSI organizations accelerate their digital transformation journeys. The landscape today comprises fintechs, regtech providers, cloud service providers, data and analytics platforms, cybersecurity firms, automation and AI vendors, and traditional IT and business process service providers. This list grows even larger when viewed through the lens of core and non-core offerings.

The specialized approach has driven technological advancements but has also created complex operational challenges for banking institutions and insurance organizations. The organization faces increasing challenges as it must manage more vendors providing both essential and non-essential business services. The institutions need to maintain operational stability and regulatory compliance as they expand their business through multiple external partnerships.

Barriers to Growth: Why BFSI Institutions Struggle to Scale Innovation

The BFSI industry exhibits intense innovation activity, but these developments operate independently of one another. The organization uses multiple vendors to provide comparable solutions, yet they operate independently and lack built-in integration capabilities. Service quality deteriorates when organizations fail to meet their business targets.

Most procurement cycles involve extended, complex periods because they must manage intricate contracts, comply with regulations, and expand their integration processes. The process of handling problems becomes unclear when no one takes responsibility for fixing them, resulting in longer-than-expected resolution times and reduced operational performance. The organization fails to translate its innovative efforts into measurable business outcomes.

The Governance Burden: Managing Third-Party Risk and Regulatory Scrutiny

The vast network of platforms and vendors requires risk and compliance teams to manage increasing operational challenges while maintaining oversight of their overall delivery standards. The process becomes difficult because governance must remain consistent while complying with regulations and managing third-party risks in systems that are breaking down. Teams spend excessive time on vendor coordination to reduce risk, preventing them from working on important strategic projects. It has led to situations where you need a specialized vendor management layer on top of your existing procurement layer, which only adds complexity and inflexibility to the system.

Bridging the Gap Between Technology Investment and Operational Efficiency

BFSI organizations have spent substantial amounts on technology, yet have not achieved commensurate operational efficiency or improved customer service quality. The organization has failed to translate innovation into operational excellence, resulting in sustainable financial success. The current operating model fails to deliver proper leadership for operational teams and risk and compliance departments.

The Cost of Inconsistent Integration on Customer and Employee Experience

The current solutions operate independently as separate systems, which prevents them from functioning as a unified network ecosystem. The system becomes fragmented when components operate independently, resulting in separate data systems that require complex integration. Multiple system owners have distinct objectives, creating challenges for achieving common goals.

Large organizations must choose among different platforms, creating operational challenges for staff and reducing efficiency. The system requires ongoing modifications that incur substantial financial and time costs but fail to deliver the desired outcomes.

The system has significant impacts on both customer service delivery and operational management. The absence of connected systems leads to poor customer service, resulting in inconsistent communication and long response times that prevent businesses from delivering seamless digital experiences. Operational teams spend excessive time on vendor management rather than on process improvement and creative work. Obstacles in managing partner organizations delay the introduction of new products and services to the market.

Risk and compliance teams face similar challenges due to ineffective monitoring across their systems and business partners. The situation creates higher operational risks, which will damage customer trust when appropriate risk management procedures are not followed.

The Paradigm Shift: Transitioning from Tool Management to Integrated Outcomes

BFSI institutions require improved technology management for their current and upcoming investments rather than additional technological solutions. The industry requires a solution model that delivers results at maximum scale while maintaining an appropriate balance between technological progress and regulatory oversight.

BFSI requires an integrated solution that unites specialized domain expertise with modern technology, comprehensive regulatory knowledge, and a reliable partner network. The organization should shift its focus from managing tools to achieving measurable business results.

The Solutions-Aggregator Model: Orchestrating an Outcome-Led Ecosystem

This need can be met through a solutions-aggregator model purpose-built for the BFSI landscape. By bringing together domain-led capabilities, advanced digital technologies, and a curated partner ecosystem, TechM enables clients to engage through a unified operating model—delivered via a single, strategic interface.

Much like leading digital platforms that seamlessly coordinate multiple specialized capabilities behind the scenes, this approach emphasizes orchestration over ownership. Increasingly, BFSI leaders are adopting a “Solution Solar System,” in which multiple solutions are aligned around a core, outcome-driven foundation. Each capability plays a defined role while remaining tightly integrated within a broader, scalable architecture.

For clients, the benefits are immediate and practical. This model reduces vendor complexity, accelerates procurement and deployment cycles, lowers integration and operational risk, and enables faster access to innovation while maintaining compliance with evolving regulatory requirements.

Through pre-integrated solutions, shared accountability, and modular, scalable architectures, we help BFSI organizations move beyond fragmented transformation initiatives and progress toward cohesive, compliant, and outcome-led growth at scale.