The year was 2016 when India saw its first transaction through a QR code. Additionally, the recent innovations are the blockchain and NFT. Transaction technology has visibly changed over the years leading to new IT job roles in BFSI industries. Banking HRs are rolling up their sleeves to recruit and train this new wave of Fintech talent. The next mission is to cut costs, boost efficiency, and provide challenging roles to the workforce. HRs are focussing on these core activities while delegating the non-core ones to payroll outsourcing firms. But before we jump into the HR outsourcing services and their advantages, let us look at the latest challenges faced by BFSI HRs. Challenge no.1- Recruiting Top Talent As a highly competitive industry, banking recruitment is not an easy job. HRs have to screen hundreds of applications ( even thousands in the case of large nationalized banks ). They have to perform background checks to check for previous financial frauds and terminations. Customers trust banks based on their experience with bank employees. And the biggest asset of a bank is trust. Approaching top talent for specific cadres and positions is a grave HR responsibility that requires thorough research. Challenge no.2- Filling the Skills Gap A PwC survey in 2016 revealed that more than 70% of IT professionals in BFSI are not well-versed in the basics of finance. More data scientists and AI engineers are needed in the industry who are knowledgeable in finance and accounting. HRs are principally concentrating to fill this skill gap by training data professionals. They are developing training modules so that IT professionals can give the best consumer experience to account holders. Challenge no.3- Employee Engagement "No company, small or large, can win over the long run without energized employees who believe in the mission and understand how to achieve it."- Jack Welch, CEO of General Electric. The top priority of HR is to provide a good work-life balance to an employee. Giving sufficient breaks, learning tools, and space for innovation are a few elements that increase employee satisfaction. BFSI industries face a big problem in this regard, as data scientists consider finance roles to be redundant. It is the job of banking HRs to let employees take on challenging tasks and incentivize them to feel fulfilled and appreciated. Challenge no.4- Work Culture Engaged employees are confident, give better service and increase the productivity levels of an organization by 21%! They also help in evolving a happy work culture for their colleagues, thus making the job of an HR easier. According to Workplace Culture, 86% of millennials will leave a job if it has a toxic work culture. The banking and financial sectors today are composed of a mixed pool of employees from all backgrounds. They have data engineers, accounting specialists, and finance lawyers all based in one place. There are high chances of clashes in a diverse workforce. HRs in BFSI dissolve conflicts between the employees and provide a smooth dialogue between all parties involved. An individual HR department is unable to overcome all these challenges at once. Payroll outsourcing services and expertise from a third party help HRs to perform core activities more efficiently. Payroll and HR Outsourcing for Banking and Finance Industry-Paysquare. How do payroll and HR outsourcing services benefit the banking and financing industry? HR duties encompass a wide range of responsibilities. On close inspection, you will realize that most of these duties do depend on each other. Strategically outsourcing a few of these activities from a reputed vendor will overcome the four challenges mentioned above. Choose payroll outsourcing firms that provide the following services to your company- Payroll Processing Statutory Compliance Leave and Attendance Management Help desks and self-service portals Temporary Staffing Solution Preparing monthly reports from the direct data provided by them will assist you in these processes- 1. Turnover Analysis An organization must regularly check its turnover rate to find out more about employee expectations, work culture, and costs incurred. inFeedo data says that BFSI industries show the lowest employee engagement rate of 33% while a high turnover rate of 24%. HRs are working towards improving these statistics by using employee engagement tactics of efficient leave management systems, punctual payrolls, and better benefits. Outsourcing payroll services from a reputed vendor will also give you enough data to devise methods of cutting costs due to turnovers. The saved time and energy can be put into the training and development of employees. 2. Payroll Outsourcing for Distributed Staff Banking and financial service companies can have between 100 to 3000 branch offices in India. These branches are distributed in a large geographical area and cover rural as well as urban centers. Individual HR departments of all these branches collaborate to process the payrolls of their employees. Payroll outsourcing will give centralized payroll processing to banking and finance employees. Outsourcing firms provide a self-service portal to employees so that they analyze the details of their payrolls. They will not approach HR to discuss these details. That is one problem solved by technology. 3. Performance Management Another crucial HR duty is increasing the productivity levels of the employees. Outsourcing payrolls and compliance will give you information regarding employee absences, overtime, and compensatory offs. You can use this data to examine the monthly performance of an employee. You can then derive suitable solutions to enhance employee experience and productivity in your organization. 4. HR Outsourcing for Temporary Staff Small-term projects are carried out in every organization. Temporary staff in BFSI industries take on roles of auditing, surveying, and coding all the time. Keeping this temporary staff on an outsourced payroll releases you from the headache of compliance and accuracy. According to GEP, outsourcing temporary staff solutions is the best cost-cutting measure. 5. Benefits and Compensation Dealing with various employee benefits plans is a highly tedious affair. These benefits cover medical, accident, and term life insurance. As an HR you also have the task of registering new employees for EPF and ESIC schemes. On top of this, another issue is worker's compensation. Employees are entitled to compensatory offs if they work on holidays. They also have overtime compensation to be fulfilled. Payroll outsourcing companies take care of all these responsibilities and give detailed reports to you. You use this data to analyze performance and award promotions to the employees. The banking and finance sector is seeing a constant current of revolution. It will be wiser if they have better human capital management to deliver the best consumer experience. Outsourcing some of those HR duties will surely assist the sector to focus on core activities and increase the growth curve. Paysquare is a team of payroll experts. Regardless of the company size, we provide services to all banking and financial companies. Outsource your payroll processing in India to us as you focus on better employee retention.