The Dutch custodian bank is launching a dedicated financial technology team to build innovative and unique data solutions to improve pension scheme governance, PP can reveal.
KAS Bank believes technology can play a much bigger role in helping pension funds, such as enabling more detailed and regular data reporting. It thinks that innovation has been lacking in the industry, and that pension schemes are not getting timely, flexible data reporting that would help them do their job more effectively.
The custodian is putting together a team of experts to create a suite of tools providing data-driven insight aimed at transforming the market. The team will also oversee the ongoing development of its pioneering cost transparency tool, which was launched two months ago.
KAS Bank managing director Pat Sharman said in a statement: "We now want to take innovation to the next level and focus on building more pioneering data services for UK pension funds, to drive better governance through more informed decision-making. Nobody else is building innovative and unique data solutions to support the UK pension fund industry, and so the underlying goal of our innovation division is to make their lives easier."
Speaking to PP, she said there are so many different new technologies - including blockchain - that could help trustees, and that perhaps they do not even realise they need it.
The bank will seek hires from inside and outside the pensions sector, representing the best the financial technology and data sectors have to offer.
By hiring talent from outside the pensions industry, it hopes this will inject fresh ideas that it believes are needed to challenge existing practices and ultimately help trustees to better govern.
It comes as trustees face huge challenges such as assessing value for money and understanding investment costs. There are also increasing concerns that governance standards are not enough, with The Pensions Regulator handing out more fines than ever over trustee failures to meet basic duties such as completing a scheme return or chair's annual statement.
The Dutch bank believes that fintech innovation could help address many of the problems facing the sector.
"Policymakers and regulators are becoming increasingly focused on improving governance of pension schemes, and as someone who's worked with pensions schemes for much of my life (including my trustee roles), I understand the drive for better governance. We have a vision of becoming the governance partner of choice for UK pension funds.
"There is a demand for accurate, transparent and timely information, which will assist trustees with more informed decision-making, and the launch of our cost transparency tool this year was the beginning of that vision."
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