What Is A Shared Service Center? A Guide For Leaders.

What is a shared service center?

A shared service center (SSC) is a centralized business unit that delivers common operational functions, such as finance, HR, IT, compliance, and customer operations, across multiple parts of an organization. Rather than duplicating these activities in every market or business line, leaders consolidate them into a single hub designed for efficiency, consistency, and scale.

For financial services leaders, SSCs have shifted from a back-office cost play to a strategic capability. Our recent Market Intelligence data shows the prominence of off-shore and near-shore SSCs has risen from 26% to 63% over the past decade, signalling a clear move toward cost optimization, global distribution, and access to specialist talent.

The challenge for most organizations is not whether to consider an SSC, but how to design, locate, and scale one without underestimating the talent and operational complexities involved.

Why shared service centers matter for financial services leaders

Financial services organizations operate under intense pressure: tighter regulation, rising cost-to-income ratios, accelerating digital transformation, and growing demand for specialist skills in compliance, risk, technology and data.

Shared service centers help leaders respond to these pressures by:

• Consolidating fragmented operations into a single governance model
• Reducing duplication across regions and business units
• Accessing deeper talent pools in lower-cost, high-capability markets
• Standardising processes to support regulatory and audit requirements

For HR, TA and C-suite leaders, the SSC conversation is no longer purely about cost. It is about building a workforce model that is resilient, scalable, and able to support long-term growth.
 

Key functions and examples of shared services 

At its core, an SSC operates as an internal service provider. Business units across the organization become its "customers", with clearly defined service-level agreements, governance, and performance metrics.

A mature SSC typically delivers across three layers:

1. Transactional services

High-volume, repeatable activities such as accounts payable, payroll processing, claims handling, KYC checks, and first-line customer support. These are the traditional foundation of most SSCs and usually deliver the fastest cost savings.

2. Specialist and knowledge-based services

More complex work including financial analysis, regulatory reporting, risk modelling, technology development, data analytics, and HR business partnering. This layer has driven much of the recent growth in financial services SSCs, particularly in India and the Philippines.

3. Centers of excellence

The most strategic layer, where SSCs evolve into centers of excellence that own innovation, automation, and process design. Industry data shows centers of excellence consistently command the highest share of mature SSC activity, reflecting their role in long-term value creation.
 

Why leaders are choosing India and the Philippines 

Among offshore SSC destinations, India and the Philippines remain the most established for financial services organizations.

Shared service center India offers:

• A deep talent pool in finance, technology, analytics, and risk
• Strong English-language proficiency and global delivery experience
• Mature SSC ecosystems in Bengaluru, Hyderabad, Pune, Mumbai, and Gurugram
• Significant capability in advanced services such as data science, cybersecurity, and AI
   

Shared service center Philippines offers:

• Strong capability in customer operations, voice services, and shared finance
• High cultural affinity with UK and US markets
• Established hubs in Manila, Cebu, and Clark
• A growing footprint in mid- and back-office financial services functions
   

The choice between markets often comes down to the type of work being moved, the specialist talent required, and how the SSC fits into the broader global capability strategy.
 

Common pitfalls when setting up or expanding an SSC

Expansions are already happening across financial services, but many leaders move forward without a clear blueprint. The most common pitfalls include:

• Underestimating talent competition: In mature SSC markets, attracting and retaining specialist talent is as challenging as in onshore locations.

• Underestimating the scale and hiring speed: SSC launches and expansions often require hundreds of hires within tight timeframes. Internal TA teams rarely have the capacity to deliver at this scale alongside business-as-usual hiring, which is where RPO solutions can support flexible high-volume hiring needs.

• Treating the SSC as a cost project rather than a capability strategy: Short-term savings alone rarely deliver long-term value.

• Weak workforce planning: Hiring volumes, role profiles, and skill mixes are often based on internal assumptions rather than local market intelligence.

• Inconsistent governance: Without clear accountability between onshore and offshore teams, processes drift and quality suffers.

• Limited employer brand presence: Many financial services organizations are well known onshore but compete against established local employers in offshore markets.

Addressing these pitfalls early is what separates SSCs that deliver lasting value from those that stall after the first wave of cost savings.
 

What leaders should do next

For HR, TA and C-suite leaders considering an SSC, or looking to expand an existing one, a small number of decisions shape long-term success. 

1. Start with the operating model, not the location: Define which functions belong in the SSC, what level of complexity you want it to absorb over time, and how it integrates with onshore teams.

2. Ground location decisions in talent data: Cost is important, but availability of specialist talent, salary inflation, attrition trends, and competitor activity matter more over a five- to ten-year horizon.

3. Plan for the full talent lifecycle: Attraction, hiring, onboarding, retention, and capability development all need to be designed deliberately, not assumed.

4. Build governance from day one: Clear ownership between the SSC, regional hubs, and headquarters reduces friction and supports regulatory expectations.

5. Plan for hiring scale, not just headcount: SSC build-outs and expansions typically involve concentrated hiring spikes, sometimes hundreds of roles within 6 to 12 months. Project RPO offers a flexible, short-term model to scale hiring capacity quickly without permanent investment in internal TA infrastructure, before winding down as the SSC stabilises.

6. Treat the SSC as a long-term capability: The organizations seeing the strongest returns are those evolving their SSCs into centers of excellence rather than fixed cost centers.
 

Building a shared service center that delivers

A well-designed shared service center can give financial services organizations meaningful advantages: cost discipline, access to specialist talent, operational resilience, and a platform for future growth. A poorly designed one can absorb investment without delivering the capability uplift leaders expected.

The difference usually comes down to how deliberately the SSC is planned, located, staffed, and governed.

If you are exploring whether an SSC fits your workforce strategy, or looking to expand an existing offshore footprint in India, the Philippines, or other markets, our offshoring talent specialists can help you make a more informed decision.

Download our Offshoring Talent Solutions E-Guide for a practical view of how leading organizations are building and scaling shared service centers, or explore our offshoring talent solutions to discuss your specific plans.