Investment Magazine asked leading figures for their thoughts on how digitisation of information for members, providers and super funds will change the business of running superannuation funds in 2016.
Damian Moloney, chief executive, Frontier Advisors spoke of the trend to what he calls “retailisation”, where members have a better digital interface with their fund and where funds use their administration platform to tailor advice and products through the use of segmenting.
“Retailisation is likely to accelerate this creativity in 2016, and will lead to an increasingly crowded and ultimately only marginally differentiated marketplace; but for the successful funds, differentiated just enough to retain, and hopefully attract, members.”
Michael Rice, chief executive of RiceWarner, said he had not seen much of this digitisation yet, but thought trust and not technology would be the determinant of success.
“The breakthrough will happen when super funds become the trusted financial partner of their members,” he said. “The banks, however, are making some gains positioning superannuation as a personal product alongside traditional banking products via online banking.”
For Maree Pallisco, superannuation leader at EY, the story could be about the entry of niche and international providers rather than funds, who could empower and engage average Australians through new digital ideas and channels.
Jim Lamborn, chief executive JANA, predicted the emergence of greater transparency for members over the investments held in their superannuation accounts. “This could encompass the actual investments held as well as other areas such as risk exposures and analytics, how the fund exercised its voting rights, etc”, he said.
Examples of funds innovating in digital technology were provided by AustralianSuper and Equip.
In December, AustralianSuper launched an app that notifies members in real time when their employer super payment has been deposited in their account.
This is intended to reduce the problem of non-payment of super by employers, which is thought to affect 700,000 workers and cost them $2.6 billion in unpaid super annually.
Shawn Blackmore, group executive, member experience and advice, said: “Many people in non-desk jobs like hospitality, construction or cleaning don’t have the opportunity to check their balances frequently, but through mobile technology, they will now be able to monitor their super balance as easily as they do their bank balance, using the app.”
Equip has started a program to more effectively tie in its online member interfaces with back-end administration. “We firmly believe that digital transformation is meaningless unless it delivers tangible improvement to the Equip member experience in the form of streamlined services and transactions,” said Danielle Press, chief executive of Equip.
Mine Wealth + Wellbeing has recently moved to a cloud based administration provider Recreo Financial Technologies that will let members see their superannuation and their personal wealth in one place.
Chief executive, Bruce Watson said: “Some things, with complicated pension calculations for example, used to take two days to do and now can be done in 20 minutes.”
In the insurance space, better digitisation of information is largely around smarter products.
Damien Mu, chief executive, AIA Australia, sees digitisation enabling more data to be collected. He said this “will result in better products and services based on needs and factoring in behavioural economics, like we are seeing with vitality and fitness devices”.
Robert Nunez, head of the industry fund segment at CommInsure, said: “Enhancing the quality and breadth of data will become a key focus area with a range of benefits flowing from this, including unlocking greater insights into membership needs to shape the product offering as well as better pricing.”