Companies Take AI Live with Financial Outsourcing
FAO service providers transcend efficiency role, become strategic partners in deploying autonomous finance capabilities, ISG Provider Lens® report says
The 2025 ISG Provider Lens® global Finance and Accounting Outsourcing (FAO) Services report finds that since 2024, providers’ use of AI, generative AI (GenAI) and advanced analytics has shifted from pilots and early-stage proofs of concept to production environments. This evolution is occurring as organizations start to embrace autonomous finance, in which intelligent systems orchestrate workflows and allow human experts to focus on high-value analysis and decision-making.
“FAO is changing from a cost-saving tool to a strategic enabler,” said Robert Stapleton, partner, Business Outsourcing Services, for ISG. “Enterprises are looking to providers to lead a transformation of finance and accounting rather than simply carry out tasks.”
As its role expands, FAO often incorporates digital finance strategy, enterprise risk management, compliance oversight and value creation, the report says. Providers engage earlier in digital transformation, shaping operating models, recommending technologies and designing governance frameworks before they start delivering managed services.
Organizations are adopting unified, cloud-native platforms from FAO providers that incorporate automation, analytics and workflow management, with AI as a core component, ISG says. AI and GenAI are being deployed in live delivery models for use cases including anomaly detection, reconciliations and cash flow forecasting. Providers are linking GenAI to process orchestration, allowing AI insights to trigger actions without manual intervention.
Agentic AI, which can execute multistep workflows autonomously by reasoning over data, is entering the picture through early production deployments, the report says. AI agents can initiate actions on their own within predefined guardrails. Initial use cases include end-to-end cash application, tax compliance orchestration and financial close and consolidation sequencing. However, providers are still determining how to align agentic AI’s pricing with its tangible benefits, ISG says.
Enterprises are increasingly adopting industry-specific AI models and vertical FAO platforms, seeking pre-configured models that deliver value quickly, the report says. Providers are rolling out solutions aimed at industries including banking, financial services and insurance (BFSI), healthcare, manufacturing and chemicals.
“Companies seeking FAO providers are now focused on execution,” said Gaurang Pagdi, analyst at ISG Provider Lens Research and lead author of the report. “They want AI productivity gains and sustainable performance improvements more than pilot projects. Providers differentiate themselves by delivering real value.”
The report also explores other FAO trends, including the changing role of global capability centers and growing demand for outcome-based contracts.
For more insights into the FAO-related challenges enterprises are facing, along with ISG’s advice for overcoming them, see the ISG Provider Lens® Focal Points briefing here.
The 2025 ISG Provider Lens® global Finance and Accounting Outsourcing (FAO) Services report evaluates the capabilities of 33 providers across four quadrants: Invoice to Pay, Order to Cash (O2C), R2R and Tax Services and Financial Planning and Analysis (FP&A).
The report names Accenture, Capgemini, Cognizant, Deloitte, EXL, EY, Genpact, HCLTech, IBM, Infosys, TCS, Wipro and WNS as Leaders in all four quadrants. It names KPMG as a Leader in one quadrant.
In addition, Auxis and Sutherland are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.
In the area of customer experience, Genpact is named the global ISG CX Star Performer for 2025 among FAO services providers. Genpact earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.
Customized versions of the report are available from Auxis Managed Solutions LLC, Capgemini, Cognizant, EY, Infosys, HCLTech and WNS.
The 2025 ISG Provider Lens® global Finance and Accounting Outsourcing (FAO) Services report is available to subscribers or for one-time purchase on this webpage.
About ISG Provider Lens® Research
The ISG Provider Lens® Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across
About ISG
ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data, in-depth knowledge of provider ecosystems, and the expertise of its 1,600 professionals worldwide working together to help clients maximize the value of their technology investments.
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Press Contacts:
Laura Hupprich, ISG
+1 203 517 3132
laura.hupprich@isg-one.com
Julianna Sheridan, Matter Communications for ISG
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isg@matternow.com
Source: Information Services Group, Inc.
