Edition: June / Aug 2017
Huge advances to improve fund-member education and communication.
Jolly Mokorosi, an independent trustee and educator who serves on the boards
of several large funds, discusses them.
Education of retirement-fund members is often expensive, sporadic and ineffective. The impact of ineffective communication ranges from obviously-inappropriate financial choices to unclaimed benefits running into many millions of rand, and to an Adjudicator complaints system clogged with queries that could partially be resolved through timely knowledge of retirement funds’ operating mechanisms.
Many of these problems could be addressed by using modern communication tools, particularly smartphones. Today their penetration into Africa is at levels that nobody could have predicted at the introduction of cellphones.
This opens the opportunity to communicate in new and cost-effective ways with members of even the smallest funds, using technologies such as videos and applications (apps). Older technologies such as sms remain relevant too.
There’s no mistaking the speed and reach of a video distributed virally. The size, capacity and pace of connections – as well as the quality of video content at relatively low sizes – presents the opportunity for retirement funds to access members in this way.
Mobile-application software downloaded by a user onto a smartphone or tablet is now so popular that the price of development has dropped to under R5 000 an app. Through apps, retirement funds are able to offer members an easy access point to their fund introduction, electronic member booklet, member benefit statement, an updated beneficiary nomination form, a summary of fund rules and the latest fund financials. All this instantly reduces communication costs whilst increasing effectiveness.
Funds have and continue effectively to use bulk sms technology to inform members of fund events. Though complaints of incomplete member records persist, funds often experience a surge in the number of members updating details following a sms campaign which alerts them to relevant fund activities.
. . . future is
Several funds have recently ventured into the use of WhatsApp. However, this requires more active management and so is currently limited in usefulness.
Imagine when retirement funds are one day (soon) able to link with members in the same way that some banks link with the Home Affairs system. Using similar technology, funds could instantly update marital status, birth records and the like. Years of member and beneficiary tracing as well as administration costs could be significantly reduced, and effectiveness increased.
Also imagine how much easier it will be to link member records when funds are able to eliminate duplicates as biometric recognition is aligned to physical documents. The scan of a fingerprint in a member’s phone could instantly link the member to multiple fund records for benefits preserved with different funds over the individual’s employment and personal savings history.
This technology is closer than we might think. Innovations enable trustees better to fulfil their primary fiduciary duties, for the benefit of fund members.