Lloyds TSB to shut down Mumbai call centre

The UK's fifth biggest bank, Lloyds TSB, plans to close its call centre in Mumbai, even as it says it will continue to outsource back office processing to India. The bank says the decision is based on customer feedback.

With the closure of the call centre the bank will return its contact centre operations to 10 call centres in UK. Earlier customer calls used to be directed to Mumbai when its UK operators were busy.

According to Lloyds TSB, with the addition of an automated call-handling system the number of callers who needed to speak to an operator had declined, reducing its requirement for the Mumbai call centre, which at stage had 600 people.

It says after the automated call-handling system, the need for operator-assisted calls had fallen to just 26 per cent. It has reduced the number of employees at Mumbai to about 180.

The bank says that of its 2,800 people in India, staff at the call centre will be given new roles.

The bank's employee union has welcomed the move saying that outsourcing calls to India had proved "a costly failure".

In the recent past, several large companies, including Powergen, have closed Indian call centres because of customer dissatisfaction.

According to a survey by YouGov just 4 per cent of people have had a positive experience when dealing with a call centre. The issue of customer dissatisfaction has acquired such mammoth proportions that several companies in the UK have now adopted a 'UK-only' call centre policy as a marketing tool.

Banking unions, however, said Lloyds TSB's reasons for closing the call centre in Mumbai is a smokescreen to hide the fact the service was poor and the public had been complaining about it.

"The bank would have known at the time it opened the Mumbai call centre that it was introducing new telephone technology. To me the opening of the centre was a way of cutting costs and it is only recently that the bank has conveniently suggested its role all along has been for the overspill of calls from its UK call centers," said Steve Tatlow, assistant general secretary of Lloyds TSB group union.

He said customers were also dissatisfied with the India call center, adding, "More than 400,000 Lloyds TSB customers have signed a petition saying they are opposed to having their financial arrangements handled abroad."

While the return of Lloyds TSB's call centre jobs from Mumbai to the UK was a major reversal in the bank's strategy, it did not mean that it was halting the offshoring of work to India, Tatlow pointed out.

"They may have redeployed the telephone operators elsewhere but are now refocusing efforts toward the transfer of work to India involving roles with no direct customer contact and therefore attracting limited complaints from customers that their financial arrangements are still being handled there," he said.

"Of the 2,820 Lloyds TSB jobs already in India at the end of 2006, just 600 were in the call centre operation. The remaining jobs are concerned with data processing and other back office work," added.