A service bureau is an organization or company that offers business services to other companies for a fee. The term often refers to companies that offer technology-based services to other companies such as financial service companies like banks and insurance companies. Service bureaus typically offer their services to companies that do not have the scale and capacity and technical expertise to incorporate these services themselves into their internal processes.
Techopedia explains Service Bureau
A service bureau refers to any company that offers its services to other companies. The services offered allow other companies to outsource non-essential business functions that the service bureau might be able to do better anyway, freeing up resources that can then be used for the core business functions.
The most common service bureaus today are call centers or customer care centers to whom many large service companies now outsource some of their operations, as the former may be able to do the job better because they already have the necessary infrastructure and expertise. Banks are also another service bureau being used by companies to handle payroll and employee benefits such as car/housing loans.