The South African retirement industry needs to accommodate reforms, while strengthening retirement savings at a lower operating cost.
According to Brian Anderson, an executive at financial services solutions provider, SunGard SA, an optimised IT infrastructure can offer some solutions.
The main challenges facing the industry are cost containment, regulatory changes and growth imperatives, he says, adding that pending retirement reforms demand new levels of efficiency, agility and compliance. The key to delivering on new mandates and future legislative changes lies in addressing the way pension funds are administered, says Anderson.
"On account of changes, this industry is now faced with an opportunity to embrace technology in order to streamline operations, improve their efficiencies and lower costs. The retirement sector may be currently slowed by the use of outdated tools and systems, duplication of processes and extensive manual interventions," he notes.
Anderson believes inefficient systems result in slow, labour-intensive and costly processes. With the sector actively seeking to deliver greater returns to retirement fund beneficiaries, Anderson cites automated operations as a solution that has the potential to ensure greater cost efficiencies through outsourced or managed services.
Improved infrastructure and processes will also enable agility and reduce time to market, while delivering significant improvements in compliance and risk mitigation and eliminating the duplication of processes, he says. In the face of a changing environment, pension fund administrators need to invest in robust platforms that support new operational requirements, including analytics, business intelligence and mobility, Anderson adds.
"By modernising their infrastructure, pension fund administrators would be better placed to contain costs and improve efficiencies, so enabling greater returns."
According to Anderson, the benefits of advanced computing are not limited to major enterprises. With rental, software as a service and application service provision (ASP) models now available, smaller pension funds are also able to harness world-class technologies to streamline their operations and contain costs.
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