Government-backed defined benefit pension plans are driving growth in the pension administration software sector, according to a new report by Marqual IT Solutions Ltd.
The global pension administration software market is expected to grow from about US$4.88 billion in 2021 to US$8.6 billion by 2028. In 2021, roughly two-thirds (66.6 per cent) of all spending on pension software came from public DB pension plans.
Many public DB plans are also adopting digital tools to provide new services, including automatic enrolment, noted the report. It also found they’re using the new technologies to improve transparency and to simplify the process of reporting to regulators.
Globally, all types of pension plans are using digital tools to simplify administration. The report noted software can now be used to create benefit statements, service purchases, buy-backs, as well as individual and group benefit computations.
However, some barriers exist in the adoption of new tools, according to the report, which concluded that plan administrators may have to educate plan members — particularly older ones — in their use.