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How to start a Rural Bpo in India?

Updated on July 16, 2017

Rural BPO is a fast emerging business model for the BPO industry which enables entrepreneurs to leverage the low-cost advantage of the rural landscape which offers skilled youth manpower and affordable infrastructure. If you are paying a BPO worker Rs 18000 per month in a metro, it will cost you only about Rs 8000 to Rs 10000 in a rural setup. Apart from this, government of India as well as state governments offer you various incentives in the form of subsidies and tax exemptions to setup Rural BPOs. It all started with a few enterprising companies like Lason India which first setup rural BPOs in 2007 in the tier-3 and tier-4 cities of India like Andhra Pradesh and Tamilnadu. Later, many such ventures followed throughout India in Rajasthan, Uttar Pradesh etc. State run IT sector promoter ELCOT in Tamilnadu setup its own rural BPO venture in Krishnagiri district of Tamilnadu which has now spread to other parts of Tamilnadu. Even though rural BPOs are only a fraction of the $11 billion BPO sector, it is sure to grow exponentially in future.

With the Indian BPO industry progressively moving towards the value added KPO (Knowledge process outsourcing) activities such as Healthcare, engineering services, Legal services etc, the earlier low value activities such as Data entry/data processing, Call center, data scanning, conversion can be better moved to rural Bpos, profiting all stakeholders- Bpos, clients as well as rural labour. Further, there is a substantial amount of graduates emerging each year from the villages of India who can be gainfully employed in the villages itself. Hence, the concept of Rural BPOs is a game changer in India.

Ruralshores, DesiCrew and Drishtee are some of the popular rural BPO ventures in India currently. With initiatives like Digital India and National e-governance plan, more outsourcing projects will be available for BPO sector in future and many of these will be from the government itself. For example, Aadhar, MGNrega projects are being increasingly outsourced to BPOs in tier-2 and tier-3 towns, and particularly to rural BPOs. Also, public sector companies and corporates are nurturing rural BPO as part of their corporate social responsibility obligation. So rural BPOs have a great future in India

What do you need? If you are a group of friends with 3-4 years of solid experience in the BPO sector spanning multiple areas like Data entry/data processing, Call center and basic management experience of leading a team, then you are sure to make it big in the rural BPO niche. Capital investment in rural BPO is negligible compared to cities. All you need is a building with basic infrastructure like Computers, furniture and hardware equipment. Rental rates are negligible in rural areas compared to cities and you can save a lot on capital and operating costs. Today, villages have good ICT connectivity in the form of broadband cable fibres and Wimax connectivity.

You can make good profit as well as well as have the job satisfaction of running your own enterprise and employing unemployed village youth and thereby contributing to the rural economy.

Avail Government schemes and subsidies: There are various incentives and subsidies provided by state governments as well as the central government. For example, there is priority for women and SC/ST entrepreneurs. Tax incentives and subsidies for capital investment are provided for MNCs willing to shift to rural areas

India BPO promotion scheme (IBPS): Under this scheme, entrepreneurs can avail of various benefits from the central government. Special incentives are available for people interested to start rural BPOs in north-east states of India.

some of the features of this scheme are

1. upto 50% one-time subsidy on capital expenditure

2. Special incentives for employing women and disabled people

3. special incentives for opening rural Bpos in hilly states such as Himachal Pradesh, Jammu and Kashmir etc

4. Encouragement for local entrepreneurs

For further details, please visit the website of the ministry of Electronics and information technology You need to apply and bid in order to avail the scheme benefits. Early bidders can avail the maximum benefits

IT minister Mr Ravi Shankar speaking on the inauguration of the scheme

Watch out for auctions: Many outsourcing projects like data entry, data conversion etc will be provided by the governments themselves or part of private-public partnership ventures. eg: Rural development schemes, digitization projects etc.These will be advertised through auctions on major newspapers. People who submit the lowest tenders will be awarded the contracts. In many cases, preference would be given for entities like rural BPOs. So watch out for them and apply for the same.

Elcot Scheme: In Tamilnadu, state run IT sector developer Elcot has a special scheme for development of rural BPOs. Tamilnadu being a front runner in the IT/BPO sector and having a strong IT infrastructure, there is great scope for rural BPOs in the state. Also, the state is a frontrunner in e-governance schemes, which means rural BPOs can get more projects from both government and private entities. Interested individuals can apply for the scheme through the Elcot website.

Start up India Scheme: A Wider scheme devised by govt of India under prime minister Shri Narendra Modi to encourage entrepreneurs to begin Startups in India, especially in the IT sector. Rural BPOs can make use of this scheme which provides tax exemptions and subsidies. To more about startups, read my hub on startups below

How Piramal Rural BPO is changing lives in Rajasthan..


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    • JvicIndia profile image

      John 10 months ago from India

      You are welcome

    • AshutoshJoshi06 profile image

      Ashutosh Joshi 10 months ago from New Delhi, India

      Superb!! Thanks for the info.

    • JvicIndia profile image

      John 10 months ago from India

      Hope this hub is helpful to young entrepreneurs