Banks are in a prime position to be one of the main winners from the pension dashboard initiative, when it comes to owning the digital customer journey.
This was one of the main conclusions from a panel debate at the Corporate Adviser Summit, discussing dashboards, data and digital engagement.
Moneyhub key account director Paul Goodwin said: “Banks have a great opportunity here. People are already on their apps all the time.” He says those that opt to develop their own commercial dashboard are in prime position to own these customer relationships, potentially winning market share from insurers and pension providers.
Goodwin pointed out that there was already a track record here, with Lloyds Bank linking to Scottish Widows pension through its app which has driven digital engagement with pensions.
Goodwin also pointed out that while there will be multiple pensions dashboards, once a consumer has logged on to one service they are likely to stick with this provider, particularly as regulation will prescribe what any dashboard can show in terms of data.
However he adds that while dashboard offerings may look similar, there will be significant differences he says “in the journey in to the dashboards, and the journey out”. Those companies who are not simply seeing this as a regulatory challenge but as an opportunity to deliver better data and information for customers will be in a prime position to benefit going forward he added.
WTW Roy Edie says that he did not see pensions consultants or advisers launching their own commercial dashboards, although they may white label existing services. “It will take companies with very deep pockets to create solutions in this space,” he added.
He forecasts that the information on these dashboards though may be used by advisers in discussions with clients. Anders Lundström CEO of the Swedish dashboard, MinPension.se said that his experience showed that 95 per cent of financial advisers in Sweden used the dashboard as part of their discussions with clients.
Those on the panel were clear that the dashboard initiative in the UK was likely to drive greater transfer activity in the market, as has happened in Sweden. In total Lundström revealed that the equivalent of £6bn had been transferred by Swedish savers thanks to the dashboard initiative.
Goodwin said: “For pension providers in the UK this is unlikely to be neutral. It will either be net positive or net negative.”
He said currently many larger insurers are expecting this to drive consolidation in the industry, but many are expecting to benefit. “They are taking a ‘built it and they will come’ approach. But they can’t all keep assets and further consolidate.”
Edie said that the initiative might help tackle the issue of small pension pots, encouraging savers to consolidate many smaller occupational pension plans – a problem that is likely to continue to proliferate thanks to AE.
Goodwin added that a number of regulatory initiatives including Open Finance, as well as the pensions dashboards are designed to put the end pension saver more in control of their own data and money. “The question for advisers is how that can use that to transform communication and engagement programmes and ensure that customer are engaging with this pension data in a more meaningful way.”