The APAC and MEA finance and accounting managed services industry encompasses a variety of back-office functions that are outsourced to third-party service providers on a recurring basis. These services primarily include general accounting, financial reporting, payroll services, issue and control compliance and other accounting functions. The finance and accounting managed services help organizations to focus on their core competencies by outsourcing non-core financial processes. The managed service providers leverage automation technologies like robotic process automation (RPA), artificial intelligence (AI) and cloud computing to deliver services more efficiently at lower costs as compared to traditional in-house models.
The Global APAC and MEA Finance and Accounting Managed Services Market is estimated to be valued at US$ 1328.41 Bn in 2024 and is expected to exhibit a CAGR of 18% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the APAC and MEA finance and accounting managed services are GuardRFID Solutions Inc., ALE International (Nokia Corporation), Favendo Gmbh, Teldio Corporation, CenTrak, Cisco Systems Inc. (Cisco Meraki), AiRISTA Flow Inc., Creativity Software Ltd., IBM Corporation, DigitalGlobe Inc. (Maxar Technologies), Aruba Networks (HPE Development LP), Ericsson Inc., HERE Global BV, IndoorAtlas Ltd., GL Communications Inc., and Esri Inc. The market is witnessing high demand due to cost efficiency of offshore outsourcing models and availability of accounting talent in low-cost locations. Several businesses are outsourcing their finance and accounting activities to MEA regions like India and Philippines to gain significant cost savings.
The market is witnessing a strong global expansion driven by multi-year managed services contracts with international corporations. Majority of contracts are for business processes and domain expertise in fields like Financial Planning and Analysis (FP&A), General Accounting, Accounts Payable/Accounts Receivable etc. The service providers leverage their presence across multiple geographical regions to provide round-the-clock support with uniform processes and technological enablement.
Market drivers
One of the key drivers of APAC And MEA Finance And Accounting Managed Services Industry Market Size is the offshore outsourcing model. Organizations outsource their non-core financial activities to managed service providers based in lower cost locations to gain 30-40% savings compared to in-house models. The service providers in MEA countries have dedicated finance and accounting talent pools that handle processes at lower total cost of operations. This makes offshore outsourcing lucrative for businesses across the globe.
The current geopolitical situations in Asia Pacific and Middle East & Africa regions are impacting the growth of finance and accounting managed services industry in the region. With rising political tensions and economic uncertainties due to issues like conflicts between countries, terrorism, inflation etc. organizations are facing challenges in their cross border operations and regional expansions. This is pushing them to adopt managed services to outsource their finance and accounting functions for ensuring business continuity and reducing operational costs.
Managed service providers are helping organizations mitigate risks associated with geopolitical instability by providing flexible, on-demand and cloud based finance and accounting services through their expertise and resources located across multiple locations. They are also improving companies' ability to comply with the fast changing regulatory laws and tax policies of different countries. However, service providers need to devise solutions securing finance related data and addressing issues of data localization and sovereignty to boost customer trust amid political uncertainties.
In terms of value, the APAC region currently holds the major share of the finance and accounting managed services market. Countries like China, India, Japan, Australia dominate the market owing to the rapidly growing digital transformation initiatives across industries, increasing outsourcing of finance functions, and presence of global shared services centers. However, the MEA region is witnessing the fastest growth led by Gulf countries such as UAE and Saudi Arabia. Organizations in MEA are increasingly leveraging managed services for gaining cost efficiencies needed to tackle economic slowdowns and issues like budget cuts caused due to geopolitical instabilities.
The finance and accounting managed services market in APAC region concentrating majorly in East Asia. Countries like China, Japan and other Asian countries dominating the market in terms of value. This is due to rapidly growing digital transformation across industries, rising outsourcing of finance and accounting functions to managed service providers and presence of several global in-house centers and global business services hubs in East Asian countries. However, South East Asian countries are witnessing fastest growth led by countries like Indonesia, Malaysia, Philippines and Vietnam. Economic development and initiatives to develop financial hubs is driving organizations in Southeast Asia to adopt managed services to access finance expertise.
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