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GOOD ADVICE IS CRUCIAL TO SMEs WHEN CHOOSING AN AUTO-ENROLMENT PROVIDER

Wednesday, November 21, 2018

British SMEs prize value-for-money from their providers – but at the purchasing stage, what SMEs want is a good recommendation.

Welplan worked with Opinium to question 500 senior decision makers at SMEs who use more than 28 different master trust providers in September and October 2018. 

When asked for the reasons they chose their current auto-enrolment provider (respondents could pick as many answers as they liked):

  • 35% of respondents cited a recommendation – demonstrating the value of good advice.
  • 30% mention straightforward administration – showing the importance of reducing the considerable hassle of administering pensions.
  • 27% value customer service – demonstrating the importance this plays in auto enrolled pensions.
  • Only one in four (25%) of respondents chose their provider because they had an existing relationship.

When asked about what they value in an automatic enrolment pensions provider, once they are signed up, SME business owners and leaders tend to prioritise the same set of criteria:

  • 50% cite value for money – and that score rises dramatically among managing directors (62%).
  • 44% easy transactions.
  • 40% customer service.
  • 37% a good choice of investment options.
  • 36% cite investment performance.
  • 25% the personal touch.

Bruce Kirton, chief executive of Welplan Pensions, says: “Advice is crucial for SMEs when they select an auto enrolment partner. Business leaders, especially if they have operational responsibilities, want a recommendation to help them navigate the complexity of workplace pensions.

“Customer service is also important. In particular, businesses value providers who can make administration simple and straightforward.

“Since auto enrolment we’ve worked hard to give our clients simple-to-use systems. That includes direct access to our technical people so they can get expert help whenever they need it. The importance that survey respondents placed on this shows how critical Welplan’s service offer is.

“Investment options are increasingly important to people and, as auto enrolment plays out, I expect to see this given a lot more priority. Not only will default fund design have to incorporate responsible investment criteria but we need a range of imaginative at-retirement funds.”

About the research:

Welplan worked with Opinium to survey a representative sample of 500 senior individuals at micro, small and medium-sized businesses with decision making powers over their company’s auto enrolment pensions arrangements.

The fieldwork took place between 24 September and 2 October 2018

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