Part of Investing: guides on bringing capital into South Africa, investing your own money, and the rules that apply.
Business process outsourcing in South Africa means running other companies’ customer service, back office, finance, technical support and shared-service work from South African sites, mostly for clients in the United Kingdom, the United States and Australia. The industry calls this business process outsourcing (BPO) or global business services (GBS). This guide is for foreign and local investors weighing whether to open a contact centre or shared-service operation, buy into one, or fund one, and how to set it up. It separates what is official rule, what is industry-body or press commentary, and what nobody publishes a number for.
This guide was last reviewed on 30 September 2026 and is general information, not legal, immigration, tax or investment advice.
The short version: the sector is large, young and still adding jobs, and government has a dedicated wage-based incentive for it. But that incentive is short of money, the sector’s own cost-saving and headcount figures come from its industry body, and automation is starting to change how many agents a client needs. Read the incentive section first, because it has changed in the past year.
What the sector is and how big it is
The industry body is Business Process Enabling South Africa (BPESA), a not-for-profit, member-driven association that describes itself as the contact point for the GBS and BPO sector, covering BPO, customer experience, digital, and professional and shared services. It works with the dtic, Invest SA and the youth-employment organisation Harambee. BPESA is a trade body that promotes the sector, so treat its numbers as industry claims, not audited statistics.
What BPESA reports:
- In a March 2025 statement, it said headcount grew from 65,000 in 2019 to an estimated 150,000 in 2024, and market revenue from US$1.04 billion (about R18.9 billion) to an estimated US$2.91 billion (just under R53 billion).
- The sector created 26,346 new jobs serving international markets in 2025, its highest annual total since 2018, with just under 23,800 (about 90%) filled by young people.
- A 21 July 2026 media statement says 180,000 sector jobs were created over ten years, and sets a target of 350,000 to 500,000 cumulative new jobs by 2030.
Note the seams. The 150,000 headcount is an estimate for 2024. The 180,000 is jobs created over a decade, not the size of the workforce today. The 2030 figures are a target, not a forecast. We found no current official headcount for the sector in Stats SA or the dtic, because BPO is not reported as its own line in the public tables we could reach.
On source markets, BPESA says the United Kingdom accounts for 55% of headcount serving international clients, and that 33% of globally focused workers now serve the US market, up from 1% in 2019.
Where the work is done
BPESA says offshoring locations are concentrated in Cape Town, followed by Durban and Johannesburg, with Tshwane, East London and Gqeberha also named as locations with a pool of entry-level talent. The same statement lists smaller sites such as Soweto, Mitchells Plain and George as expansion areas. A September 2026 BPESA news item citing a Western Cape government-commissioned report (SkillsBoost 2026, conducted by the University of Pretoria) says the sector is moving beyond traditional contact centres and that the report’s central finding is that routine transactional work is shrinking. Press coverage puts Cape Town’s BPO workforce at around 100,000 or more, but we did not reach the full report, so treat that figure as reported, not confirmed.
The Eastern Cape is pitching itself through Special Economic Zone infrastructure. The 15% company tax rate for SEZs applies only in six Minister-approved zones (see our guide to dtic investment incentives), so check whether a specific site actually qualifies before counting on it.
The Global Business Services incentive
The dtic’s GBS incentive page says it is effective from 1 January 2019 and that its primary objective is to create employment in South Africa through servicing offshore activities. Youth employment (ages 18 to 34) and export revenue are secondary aims. The page lists separate email addresses for applications, claims and general queries, and regional contacts in KwaZulu-Natal, the Western Cape and the Eastern Cape.
Who qualifies
The dtic’s 2025/26 incentive guide sets the conditions. The applicant must be a South African registered legal entity, be in good tax standing, and be B-BBEE compliant (a certificate or affidavit). It must also be starting or expanding a GBS operation, and apply before it engages the qualifying jobs.
| Condition | Tier 1 (mostly non-complex work) | Tier 2 and 3 (mostly complex work) |
|---|---|---|
| Minimum new offshore jobs | 50 within three years of start | 30 within three years of start |
| Youth share of approved project | At least 80% | At least 60% |
| Minimum wage | R5,000 a month, or R4,000 for the first 12 months for inclusively hired resources | |
| Client contract | At least a three-year fixed term contract for offshore activities | |
| Start-up time | Operations and hiring must begin within six months of approval or the application is cancelled | |
The guide also says an applicant will not qualify if it is expected to displace existing South African jobs, for example by relocating an existing facility within the country, or if it gets concurrent benefits under the BPS Incentive, the Black Business Supplier Development Programme or the Jobs Fund. The grant and disbursement calculations sit in the GBS Incentive Guidelines document, which is a scanned image we could not extract text from. We therefore quote no grant rate per job. BPESA’s own claim that incentives cut operating costs by 7 to 10% is an industry figure, not a dtic rate.
Current status: rationing
The dtic’s January 2026 notice is the most important document for an investor. It says that in the 2024/25 financial year the department approved applications worth R1.3 billion and disbursed over R800 million. It blames rapid sector growth and budget constraints for “necessary adjustments”. It says all active approvals and claims will be honoured subject to compliance and availability of funds, and that new project applications without approvals (5-year contract) will be considered first in, first out, subject to funding, with remaining applications returned because additional budget is unavailable. It also records the indefinite suspension of the launch of the revised GBS guidelines until more funding is secured.
Two points to keep apart. The notice mentions a five-year contract, while the 2025/26 guide says three years; we do not know which the dtic applies today, so ask in writing. And the page still lists the January 2026 notice as its latest on 30 September 2026, so we found no later update. The notice said outstanding claims and new applications would be considered between April and June 2026, but we found no published outcome. Do not build a business case that depends on a new GBS grant until the dtic confirms funding for your project in writing.
Language, time zone and cost claims
BPESA’s value proposition cites a young workforce fluent in English, with neutral accents, empathy, and cultural affinity with the UK, US and Australia, and 55 to 65% cost savings against Dallas, Manchester and Sydney. These are marketing claims from the industry body. No independent or official source we found tests them, and the percentages do not say which cost lines are compared. We found no official source on time-zone advantage; check the overlap with your client’s hours yourself, since US and Australian clients may mean night or early shifts. Ask any operator for their own shift cost, not the headline percentage.
Talent and wages
Labour supply is large. Stats SA’s Quarterly Labour Force Survey for the second quarter of 2026 is reported by the press as 33.6% official unemployment and 47.4% youth unemployment (15 to 34), but we could not open the Stats SA release itself from our tools, so check Stats SA’s QLFS page. No official source we found publishes an average contact-centre wage. The legal floor is the national minimum wage, which the Minister of Employment and Labour raised to R30.23 an hour from 1 March 2026. The GBS incentive’s R5,000 monthly floor is a condition of that grant, not a market rate. Get salary benchmarks from recruiters and operators in your chosen city.
Regulation an operator must meet
Personal data and cross-border transfers
BPO means handling other people’s personal information, so the Protection of Personal Information Act 4 of 2013 (POPIA) matters more here than in most sectors. The Information Regulator is an independent body established under POPIA to monitor and enforce compliance, and it requires private and public bodies to register their Information Officers on its portal. On transfers, section 72 of the Act says a responsible party in South Africa may not send personal information to a third party in a foreign country unless, for example, the recipient is bound by a law, binding corporate rules or a binding agreement giving substantially similar protection, or the data subject consents. Most contact-centre work flows the other way: a foreign client’s customer data comes into South Africa. Whether section 72 applies then depends on who is the responsible party under the contract and where data is sent onward. Get a written legal opinion on your client contracts. We did not find a finalised Regulator guidance note on transborder flows that we could verify, so none is cited.
Labour law for shift staff
The Basic Conditions of Employment Act bars an employer from requiring or permitting more than 45 hours in any week, limits overtime to ten hours a week and requires at least one and a half times the wage for overtime. Sunday work is paid at double unless the employee ordinarily works Sundays, then one and a half times. Night work has its own chapter. The Act sets the floor; your contracts, and any bargaining-council or collective agreements that apply, may add to it. Check those with an employment lawyer.
B-BBEE, tax and company set-up
The GBS incentive requires B-BBEE compliance, as above. The standard company tax rate is 27% (see the tax notes in our incentives guide). For the operating company, see our company registration guide, and for moving capital in and profits out, our exchange control guide.
Visas for foreign staff
Most staff will be South African, but a foreign owner or specialist manager needs a route. The Department of Home Affairs says a critical skills work visa is not a work-seeker’s visa, so an offer of employment is needed, and the list in force was gazetted on 3 October 2023 (Gazette 49402); check the Home Affairs checklist page for whether your role appears. The Invest SA One Stop Shop lists business visa recommendations, critical skills visa facilitation and intra-company transfer permits among its services. Our visa comparison and business visa guide cover the options in detail.
Power and connectivity risk
SAnews reported on 29 June 2026 that Eskom had gone 406 consecutive days without load shedding, with unplanned outages down year on year. That is a good record, but it is a record, not a guarantee. A contact centre losing power or connectivity breaches client service levels within minutes, so most operators still plan for backup power and dual network providers. Connectivity has its own exposure: press reports in March 2024 described several subsea cable breaks that disrupted internet access in South Africa. We found no official figure for how often this happens, so ask any site’s landlord and carrier for their redundancy and their outage history.
Automation and AI risk (commentary)
This is the risk that most changes the investment case, and what follows is commentary, not official data. BPESA’s impact sourcing guide launch, as reported by Engineering News on 7 August 2026, says automation is increasingly capable of handling routine interactions that have supported many entry-level BPO jobs. Business Day reported in May 2026 that the listed property company Redefine, as a commercial landlord, sees AI as a serious threat and believes it could automate more than a third of BPO services in under five years. That is one landlord’s view. A contact-centre founder quoted by EWN in July 2026 expects AI to remove a significant portion of low-skill repetitive work over five to 10 years, but not to end outsourcing, and to shift client demand from large agent counts toward smaller teams of skilled people.
For a headcount-based model, such as billing per seat, this points to a practical rule: prefer contracts priced per outcome or per transaction, give extra weight to complex work (the GBS incentive’s Tier 2 and 3), and stress-test returns against a fall in seats per client. Nobody publishes a verified forecast for South African BPO headcount, so any percentage you see is an opinion.
How an investor starts
- Decide the model first: an operator with your own clients, a joint venture with an established BPO, or an acquisition. Ask what share of work is routine versus complex.
- Choose the city by talent depth and costs, using quotes from operators and landlords, not headline percentages.
- Register the company, plan exchange control for foreign funds, and register an Information Officer with the Regulator.
- Have your lawyer review client contracts for POPIA, data location and liability.
- If you want the GBS incentive, contact the dtic before hiring, ask in writing whether funding exists for new projects and what contract length applies, and do not engage qualifying staff until you have approval.
- Sort out visas for any foreign managers through the One Stop Shop and our visa guides.
- Budget for backup power, dual connectivity and staff training before the first client go-live.
The wider Investing hub covers other sectors.
What we could not confirm
No official current sector headcount or contact-centre wage; the GBS grant rates (the guidelines PDF is a scanned image); which contract length the dtic applies now; any dtic update after January 2026; the full SkillsBoost BPO report; the Stats SA Q2 2026 release text; and any independent test of the 55 to 65% cost-saving claim.
Frequently asked questions
Can I still get the GBS incentive for a new contact centre?
Possibly, but it is rationed. The dtic’s January 2026 notice says new applications without approvals are considered first in, first out, subject to funding, and the rest are returned. Apply before hiring and get written confirmation of funding.
How many people does a project need to qualify?
Under the dtic’s 2025/26 guide, at least 50 new offshore jobs within three years for mostly non-complex work, or 30 for mostly complex work, with youth shares of 80% and 60%.
Does POPIA stop me handling foreign clients’ data?
No, but it applies. Section 72 restricts transfers of personal information out of South Africa without adequate protection or another listed ground. Have a lawyer map who is the responsible party and where the data travels.
Can a foreign owner run the business from South Africa?
There are routes, including critical skills, business and intra-company transfer visas. A critical skills visa needs a job offer and a listed occupation. See our visa guides and the Invest SA One Stop Shop.
Is load shedding still a risk to call centres?
Eskom reported 406 consecutive days without it by late June 2026, but operators generally still plan backup power. Ask any site for its outage history.
Will AI make South African BPO pointless?
Nobody knows. Credible commentators expect fewer routine agent roles and more demand for skilled staff. Favour outcome-priced contracts and complex work.
