May 17, 2006
Security Concerns on Outsourcing
India has become the hub for outsourcing industry. Most US companies outsource their customer service to call centers to India because of low labor costs and abundance of workers. However, in the recent days, security concerns have forced companies to reconsider their decision on outsourcing to India.
According to a recent survey made by Forrester Research, companies such as Bank of America, ChoicePoint, Citibank and Time Warner experienced the loss of customer information. The security concerns have raised the debate over the reliability of business process outsourcing industry. For India, it is a serious issue as the country receives huge benefits from outsourcing. Outsourcing also provides employment and career opportunities to millions of Indian youth. Hence, it is in India's interest to ensure effective data protection to woo more outsourcing companies to its soil.
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In one security breach last year, three former employees of MphasiS, a company providing outsourcing services, were arrested for stealing more than $350,000 from four customers of Citibank. The workers were accused of acquiring passwords and transferring money from customers' bank accounts into their own.
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