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Super funds slated for big admin business
Superannuation funds could become the administrators for the SMSF market, according to Bravura Solutions' Garradin manager Darren Speirs.
He said large companies are likely to soak up books of self-managed super fund (SMSF) clients by providing outsourced administration services.
Speirs said market consolidation would create the need for scaleable administration and resources for SMSFs that were interchangeable and less specialised.
"Large companies will soak up books of business by actually establishing relationships with the accountant and providing outsourced administration services, that's where my guts telling me things will go," he said.
Super funds and WRAP players already used "sophisticated" administration services which made them likely candidates, according to Speirs.
"They already do that en masse so I wouldn't be surprised if they start stepping into this in a big way and start offering that," he said.
Andrew Bloore from IQ told a Bravura roundtable that SMSFs would kick in when members had a reasonable account balance and became "emotionally invested". He said it was usually when members were between 30 and 50, although after they retired they may return to their super fund because it required less attention.
"A SMSF is not separate to the super industry, it's really another aspect of someone's superannuation lifecycle if you like," Speirs said.
He said superannuation funds should be looking beyond their existing products and direct investment options to deliver innovations to the SMSF industry.
"It really sounds like these organisations should actually embrace SMSFs and find something that's a little bit more innovative rather than sticking to their existing products and try and address the problem," he said.
Class Super and BGL were two large company's Bravura had partnered with to deliver SMSF administrative services, said Speirs.
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