Pension Bee: Fintech Revolution for Pensioners

• 21 February 2020 | 1425 Views | By Abhinav Mishra

What do you do when you have to check your bank account details? Login to the mobile app and check the balance and perform any other bank-related activity at ease. When it comes to pensions people just don’t like talking about it or doing anything about it. Why? Because it is boring, troublesome and always comes with a lot of paperwork.

When it comes to pension the biggest problem in front of consumers is managing different pension pots. The new age people are changing employers very frequently which means they end up having multiple pension pots from past employers’ pension schemes. Once people have so many pension pots it is almost impossible to keep track of all of them. By the time people retire, they have no clue what they have in their pension funds.

The solution to all these problems is provided by a company called Pension Bee. They have entered into the pension industry to make a difference. They strive to make the pensions simple as well as engaging. They want people to have control on their pensions and in the process not even use a single piece of paper. The traditional providers are still working via post and tons of paperwork. They are the much-needed revolution in the industry from a very long time.

Pension Bee is a UK based company launched in 2014. They are not only attempting but also are successful in changing the UK pension industry. How? They are making it easier for people to locate and consolidate their existing pension plans. Even though they are relatively new to the industry, they have been successful in getting over 238,000 customers with them.

One in ten UK consumers seeks financial advice which clearly shows UK consumers don’t plan for their retirement. The traditional pension products available in the market come with big charges, hidden caveats, and complex legislations. The situation has changed in the last decade because of strict regulations and increased competition between providers. The use of technology is also changing the face of the UK pension industry.

Pension Bee is harnessing all three of these. They are providing consumers a service that will locate their existing pension pots and consolidate them into a new low-cost pension plan. Customers sign up with the names of their old providers or employers and then Pension Bee transfers and combines their old pension pots in an astonishing time frame which many thought was not possible. Once the transfer process is done and pension pots are combined, Pension Bee customers can manage their pension account just like a bank account – 24*7 access on the web as well as on the Mobile.

When asked with Jasper Martens, CMO, the reason why a lot of people are joining the PensionBee platforms? He explains the reason in a line – “Time is the most valuable thing for people now. People are busy with their jobs and families and they don’t want to take a day off just to manage their finances. Now they want everything at the tip of their fingers and PensionBee is providing them exactly what they need.”

What are they offering the customers? They have seven plans to offer the customers and their plans are managed by some of the world’s biggest managers – HSBC, State Street Global Advisors, BlackRock and Legal & General. Once a customer opt in for a particular plan, they are not bound to it forever. They can change the plan in the future at no cost. The seven plans are as below :

Tracker – Invests money in global shares, bonds, and cash. Investments follow the world’s markets as they move.

Tailored – Money moves into safer investments as people get older so money is invested at different palaces at different times.

4Plus – Aims to achieve long-term growth of 4% per year, by managing money actively across a range of investments.

Future World – Invests money into companies that pledge to move to an environmentally-friendly economy.

Shariah – Invests money only into Shariah-compliant companies. These investments are approved by an independent Shariah committee.

Preserve – Makes short-term investments into creditworthy companies reducing risk which preserves customer’s money.

Match – Invests money into a mix of assets, with investments following the strategies of the wider pensions industry.

As already mentioned, they will do all the work to transfer your existing pensions pots in the plan you choose and in the process you literally don’t have to do anything. Once everything is done by PensionBee, you can manage, top-up or view your PensionBee pension online.

The UK consumers were never happy with the pension industry because of the high charges. PensionBee has changed that for the consumers. If you look at their numbers they are very competitively priced compared to other pension providers.

Depending on the plan you choose, PensionBee charges in the range from 0.50% to 0.95% a year. They have more to offer other than low annual charge. They half the fee on all investments over 100,000 pounds. To make you understand better, let’s take an example. Let’s say you have 150,000 pounds in the PensionBee tracker plan, they will charge you 0.50% on the first 100,000 pounds and on the remaining 50,000 pounds only 0.25%. As per the industry experts, their pension product is one of the cheapest in the market.

All the use of technology and ease of using pension products is fine but at the end of the day as a consumer you want your money to grow. PensionBee funds are managed by some of the best companies in the market – Blackrock and State Street Global Advisors. The performance of different funds is different but to sum up, their couple of plans like PensionBee match and PensionBee Tracker have outperformed the benchmark. Overall, most PensionBee customers are happy to see how their pension pot is growing.

By now, you must already be thinking to move your pension to PensionBee. PensionBee is a viable option for those who don’t have a final salary pension and also for those who are interested in saving on the annual fee. If you are self-employed, PensionBee offers you a facility to top up your pension on ad-hoc basis and it is just a few taps away via the app.

PensionBee has given exactly what customers were looking for and their Trustpilot score of 9.2, an NPS rating of 50, and a retention rate of 98% speaks volumes about the service they are providing to its customers after they are onboarded with them. They execute their plans taking into consideration the feedback provided by the customers. As a customer, they are very easily available – you can reach them via live chat, social media, and phone calls.

PensionBee has grown multifold yet the founders (Jonathan Lister & Romina Savova) still see a huge growth opportunity given the UK defined contribution pension market will be touching 1 trillion pounds by 2024. They believe there’s still a lot to do in order to make the pensions industry fairer and more accessible.