Risks Management of Offshore Outsourced Technological Services in Financial Industry

The purpose of this paper is to make the outsourcing financial companies (clients) aware of,the risks and pitfalls involved in the analysis and evaluation of third-party service providers (vendors), particularly from the security aspect. The paper identifies the risks involved in the delegation of financial services to offshore vendors arising from informational problems and incentive conflicts, then puts forward the risk management process and framework, Such as assessing, monitoring, and controlling the risks associated with vendors. It is important that management understand and evaluate the potential risks so that a thorough assessment can be made before deciding on outsourcing to an offshore vendor.