MphasiS, EDS plan rupee billing to steer clear of falling dollar

Mumbai: Software and back-office service firm MphasiS is in talks with parent Electronic Data Systems (EDS) to bill contracts in rupees as the Indian currency continues to rise.
"With the dollar revenue, we continue to work with our customers to ensure that we have some protection and a vehicle in place to get a higher rate because of the currency appreciation," Deepak Patel, its managing director, said at the Reuters India Investment Summit in Bangalore.

The rupee, which hit a near-decade high of 39.16 against the US dollar in November, has been a concern for the IT and back-office industry, whjich gets much of its billing revenue in dollars.

"Probably most of the damage is done, that doesn''t mean that there won''t be more damage," Patel said, adding that, in the longer term, the rupee "has nowhere else to go but appreciate."

Patel said MphasiS is evaluating a plan to set up a business process outsourcing unit in the Philippines as it is a lower-cost option for some BPO services.

While the company has not yet been hurt by the mortgage market turmoil in the US, Patel said, "It''s going to be a long-drawn out scenario."

MphasiS, majority-owned by US computer services firm EDS, gets about 45 per cent of its revenue from the financial services industry.

US banks have announced billions of dollars of write-downs tied to the US housing slump, as defaults soared and the value of sub prime mortgages that investors deemed too risky plummeted.