Shed some light on Contract Staffing? Why did it start? What problem does it solve?

Can anyone shed some light on Contract Staffing?
1. Why did it start?
2. What problem does it solve?
3. What are the problems that this Contract staffing will create?
4. What are the statutory obligations for a company getting into contract staffing should have?
5. Any support from the banking system towards this contract staffing is available?
Kindly advise.
Thanks and Regards
Ravichandran Rajagopal

If you are planning for contract staffing for the temporary nature of job profile, then recruit staff on 'Fixed Term Contract Basis' This is approved form of staffing on temporary job requirement.