Course Details
Outsourcing & Vendor Management Arrangements
Outsourcing & Vendor Management Arrangements

Banks are increasingly using third party services to carry out activities, functions and processes as outsourcing arrangements to meet new & complex challenges like innovation in technology, increasing competition, economies of scale and improvement in quality of service to clients (i.e., customers, depositors or investors).

Workshop Overview  

Banks are increasingly using third party services to carry out activities, functions and processes as outsourcing arrangements to meet new & complex challenges like innovation in technology, increasing competition, economies of scale and improvement in quality of service to clients (i.e., customers, depositors or investors). The practice, however, can increase their dependence on third parties and consequently their risk profile. In order to allow the licensed institutions to effectively manage the outsourcing arrangements, the guidelines have been formulated to ensure that they are able to meet their financing and service obligations. These guidelines, however, in no way encourage outsourcing, especially the performance of core banking functions.  The licensed institutions, while deciding to outsource any function, should ensure that outsourcing should not reduce the protection available to depositors or investors nor be used as a way of avoiding compliance with regulatory requirements. It will be responsibility of the licensed institutions to continue to satisfy all regulatory/legal requirements issued to them from time to time, while entering into any outsourcing arrangement. 

 

Why Your Officials need this Workshop:

 
Capitalize on core banking business,  Benefit from economies of scale and cut costs Increase business efficiency and productivity Ensure standardization and uniformity Ensure regulatory compliance  Applicable to: Commercial banks, Islamic Banks, Microfinance Banks and  Standalone Microfinance Branches, Development Financial Institutions DFIs,  Companies Dealing with all above as a Vendor Outsource.

 

Who should attend:

All Management / Unit Heads and executives with Outsourcing / Vendor Management responsibilities including Information Technology, HR and Admin, Risk Management, Compliance, CAD,  Internal Audit, FMU, Internal Control, IFRS, Finance Professionals

 

Understanding the Outsourcing 

Outsourcing arrangements in Banking Sector – Need Assessment 

 

Core Principles of Vendor Management 

  1. Selection of Vendors as Partners
  2. Due Diligence framework for Vendors
  3. Management of Partners for Outsourcing  
     

Outsourcing and Vendors Contracts / Sub Contract Agreements

  1. Service levels and performance requirements
  2. Pricing and fee structure
  3. Dispute resolution arrangements
  4. Confidentiality, privacy and secrecy of information
  5. Liability and indemnity
  6. Ensuring access to SBP.
  7. Outsourcing Global Practices
  8. Restricted Activities in Outsourcing and Vendor Management
  9. IT Outsourcing – Economies of Scale
  10. Risks & Rewards of Outsourcing
  11. Continued Supervision tools
  12. Redressal of Grievances about Outsourced Services
  13. Contingency Planning
  14. Board & Management Responsibilities
  15. Confidentiality of Customer Information in Outsourced Functions
  16. Issues for Regulators
  17. SBP’s Key Policy Objectives and Initiatives
  18. Business Continuity Plans
     

SBP's Guidelines on Outsourcing Arrangements by Banks

  1. Current Status of Outsourcing of Services in Pakistan
  2. Audit and monitoring procedures
     

Industry Response

  1. Common issues of  Compliance –Banking Industry
  2. Responses of Banking Industry
  3. Regulatory Impact Assessment
  4. Outsourcing of Services in Pakistan – The way forward
  5. Case Studies

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