Vendor Analysis
published on Apr 22, 2015
Report Overview:
This NelsonHall assessment analyzes EXL's offerings and capabilities in retail banking BPO. EXL is one of a number of mortgage and loan BPO companies analyzed in NelsonHall's comprehensive industry analysis programs.
Who is this Report for:
NelsonHall's Mortgage and Loan (M&L) BPO Vendor Assessment for EXL is a comprehensive assessment of EXL's M&L BPO offerings and capabilities designed for:
- Sourcing managers monitoring the capabilities of existing suppliers of capital market process outsourcing and identifying vendor suitability for M&L BPO RFPs
- Vendor marketing, sales and business managers looking to benchmark themselves against their peers
- Financial analysts and investors specializing in the support services sector.
Scope of this Report:
The report provides a comprehensive and objective analysis of M&L offerings, capabilities, and market and financial strength, including:
- Identification of the company's strategy, emphases and new developments
- Analysis of the company's strengths, weaknesses and outlook
- Revenue estimates
- Analysis of the profile of the company's customer base including the company's targeting strategy and examples of current contracts
- Analysis of the company's offerings and key service components
- Analysis of the company's delivery organization including the location of delivery locations.
Key Findings & Highlights:
EXL started in M&L BPO in 2002, delivering origination services for an Alt A lender; the Alt A relationship has continued since then in various corporate avatars. In 2007 mortgage administration services were added to the relationship, and in 2008 default management was added and is now the largest of the service lines delivered to this relationship.
EXL's banking BPO senior management all comes from the banking industry.
EXL M&L BPO delivers services from two delivery centers:
- Noida
- Gurgaon.
EXL's M&L BPO supports client operations in the U.S. markets.
EXL's primary targets for M&L BPO are financial institutions headquartered in the U.S. It is now pursuing expansion into the U.K. and Asia (it has an existing Singaporean bank as an M&L BPO client).
Institution types which are being targeted by EXL are:
- Regional and super regional banks: largest current penetration
- Standalone mortgage lenders: since 2007 there has been significant consolidation in this space, but new names are currently growing in this space
- Mortgage services vendors and private equity investors: as a sub-servicer, this segment is currently growing
- Global large banks: this segment has been the most difficult for EXL to penetrate, and is a lower priority.
EXL supports its clients in their local national markets. The focus in M&L BPO is currently on loan analytics. As the mortgage industry has changed over time EXL has adapted, shifting the bulk of its services from processing to analytics (risk management, collateral assessment, and credit/borrower assessment). It expects to continue to change the mix of processing services, as clients require, in this highly cyclical industry.
EXL has focused on the U.S. market for offshore delivery based M&L BPO services. EXL has focused on mortgages and unsecured loans (primarily credit card loans) for its M&L BPO business. In the lending industry EXL is focused on credit analysis, collateral valuation, and analytics services, including risk analytics BPO.
By creating a domain competency based on analytics, EXL is looking to increase relevance for its clients, as they grapple with changing regulations which are focused on risk management and reduction. In addition, the consulting services, which EXL uses to deliver improved analytics capabilities to its clients, are gateway services to a broader set of M&L BPO services.
EXL is also expanding its geographic scale in two ways:
- Delivery: EXL is increasing its onshore delivery capabilities within the U.S. so that it can address processes which cannot or will not be offshored
- Sales target: EXL is expanding to provide services to South Asian markets (e.g. Singapore, Australia) and the U.K. By expanding into these markets, which are cyclical but not correlated to the U.S. market, it can mitigate the challenges of loan processing cyclicality.