British companies will need to outsource work to India and other low cost economies at a faster rate to benefit from lower labor costs and exploit the benefits of globalization, according to Deloitte.

In a report, Deloitte analysis shows that outsourcing to India and elsewhere would need to be stepped up in the next four years. Deloitte has predicted a huge shake-up in the area of processing as firms try to react to increasingly cutthroat competition from across the world.

The report predicts that an increasing number of products will become commoditized. With customers unwilling to pay more than a bare minimum for such services, margins will become thinner making it increasingly important for companies to cut costs where they can, according to the report.

According to The Herald, the report adds that savings generated from offshoring work to places like India could be re-invested in developing services for high-value market segments, such as the ‘mass affluent’, in mature areas.

Banks and the like will need to ensure that they are positioned to tackle emerging markets, like China and India, in which financial-services markets are set to grow much more rapidly than in the West, it indicates.

The report was based on a survey of chief executives at 175 leading financial-services organizations out of which 65% highlighted globalization as the biggest issue facing their organization.