Outsourcing in Nepal: What the future holds for the industry

Is outsourcing in Nepal a smart move for your business?

Yes. Outsourcing in Nepal gives companies low labor costs, a young English-speaking workforce, and a fast-growing base of BPO and IT providers.

• Wages run well below rates in India and other South Asian markets.
• Firms deliver IT, healthcare, finance, and customer support services.
• Government policy and rising internet access keep the sector growing.

This article is a submission by Kantipur Management. Kantipur Management is a certified ISO 9001:2015 company specializing in Contact Center and Business Process Outsourcing.

Over the last 15 years, Nepal has grown into a strong outsourcing destination. According to the Trading Economics BoP of 2020, Nepal exported ICT services worth about US$287 million. The BPO story began in the late 1990s. First came medical transcription work and call centers.

In 2010, the government named IT and BPO as one of five priority export industries. As a result, the sector expanded quickly. By 2013, Nepal had more than 6,000 BPO enterprises, and the number keeps climbing.

Many global firms outsource in Nepal because labor costs sit below India, Pakistan, and other neighbors. Because of this, companies can build a niche here at low cost. Salaries range from NRs. 15,000 to NRs. 200,000 per month. So pay depends on the skill and experience of each worker.

BPO services in Nepal

Outsourcing in Nepal started in the late 1990s and early 2000s. First came medical transcription and call center work. In the year 2013, records showed more than 6,000 BPO companies. However, only 256 of them were legally registered.

Several leading providers rose between the early 2000s and 2010. For example, Cotiviti, Alaya (formerly HLE), Leapfrog, CloudFactory, Deerwalk, InfoDevelopers, LogPoint, Verisk Nepal, Yomari, and Fusemachines all grew during this period.

Cotiviti opened in 2004. As one of the oldest BPO and IT companies in Nepal, it now runs with a large local team. The firm offers software development, design, testing, and healthcare informatics.

Meanwhile, Deerwalk, Leapfrog, CloudFactory, and Alaya scaled up after 2010. Each one carved out a clear niche. For example, Alaya supports the mortgage industry with home loan and broker services. In addition, Fusemachines focuses on AI strategy, support, and products.

CloudFactory handles data processing, analysis, and machine learning. Similarly, Leapfrog and Deerwalk offer software development, data management, and healthcare analytics. As a result, these firms lead in healthcare, education technology, and finance. Most of their clients sit in the United States and Canada. Others come from Europe, Australia, Japan, and Russia.

Remote work has since become normal, and demand for outsourced services keeps rising. The global BPO market size was valued at about US$328.4 billion in 2025. Moreover, it is projected to reach US$695.8 billion by 2033. So outsourcing in Nepal should keep growing for years.

The future of outsourcing in Nepal

Outsourcing in Nepal holds strong potential. The country offers steady innovation, low wages, skilled staff, and a flexible time zone. In addition, the government keeps pushing ICT in schools. As a result, more graduates leave ready for IT and BPO work.

Here is what businesses should expect next.

A skilled talent pool with strong English

Nepal has many young graduates in management, science, and technology. As a result, they deliver quality work to outsourcing firms. About 14.9% of the population is aged 18 to 24. Another 17.5% is aged 25 to 34. Internet use runs high among these groups.

Schools and universities also teach in English. So English skills stay high among young people. In fact, recent EF English Proficiency Index editions rank Nepal at the top of South Asia.

A rise in export value

Export value keeps climbing. Under the Nepal Trade Integration Strategy, IT and BPO exports reached at least US$100 million in 2016. Nepal Rastra Bank later reported that IT services grew by 17.1% in one fiscal year. So the trend points up.

Supportive government policies

The government wants a friendly setting for BPO and IT. As a result, it offers tax incentives, better infrastructure, and a dedicated IT park. Because of this, foreign investment continues to flow in.

Better internet services

Internet access keeps improving. Internet penetration rose from 35% in 2020 to 51.6% at the start of 2023. According to the Nepal Telecommunication Authority, fixed broadband reaches 33% of people. Meanwhile, mobile broadband reaches 98.46%.

Steady spending on fast internet will lift efficiency. As a result, more outsourcing firms will set up here.

With more technology comes more risk. So data privacy and protection matters as much in Nepal as anywhere. The good news is that firms are acting. For example, they now study local privacy rules and adjust their operations.

Providers also work hard on service quality. As a result, they meet international standards and win a competitive edge. Finally, public and private teams keep collaborating to build a friendly business setting.

Why businesses are outsourcing in Nepal

Nepal is now a strong outsourcing choice in South Asia. It offers low labor costs, English-speaking staff, and a flexible time zone. As a result, the country has joined the global market with confidence.

Nepal has become a viable offshore location. Its skilled workforce, friendly policies, and internet growth all help. So companies should weigh it for customer support and technology work. In the coming years, we expect outsourcing in Nepal to grow even more.

Key takeaways

• Outsourcing in Nepal pairs low costs with strong English skills.
• Firms like Cotiviti, CloudFactory, and Alaya lead the sector.
• The global BPO market may reach US$695.8 billion by 2033.
• Government policy, IT parks, and tax breaks attract investment.
• Rising internet access keeps improving delivery and reach.

Frequently asked questions

Why do companies choose outsourcing in Nepal?

Companies choose Nepal for its low labor costs and skilled staff. In addition, English skills run high, and the time zone suits many clients. As a result, firms get quality work at a fair price.

What services do BPO firms in Nepal offer?

Nepali firms handle IT and software work, healthcare informatics, and finance tasks. They also run call centers and data services. So clients can outsource both technical and support roles.

How much do outsourcing workers in Nepal earn?

Pay ranges from NRs. 15,000 to NRs. 200,000 per month. So rates depend on skill and experience. Because of this, clients still gain clear cost savings.

Is Nepal a safe place to outsource sensitive work?

Providers now take data privacy seriously. As a result, they follow local rules and global standards. Many also hold quality certifications, which builds trust.

Will outsourcing in Nepal keep growing?

Yes. Strong internet growth and friendly policies both support it. Because of this, most signs point to steady expansion.

Pareshor Kharel is a customer service enthusiast and the managing director at Kantipur Management Private Limited. He can be reached at paras@kantipurmanagement.com.np