Pension funds looking to expand internet services
At the head of the pack of financial institutions offering services over the internet, pension funds are preparing to allow their customers on-line access to their accounts.
While most of Poland's 21 pension funds already have web sites, many are now looking at expanding internet services aimed at existing and potential members. One, Nationale-Nederlanden (NN), plans to be the first on line with its service active by the end of April, said Joanna Jarmuzewska, internet project manager at PTE Nationale-Nederlanden Polska. Bank Slaski and ING Holdings jointly own the fund.
Jarmuzewska refused to disclose how much Nationale-Nederlanden was spending on its internet project. The pension fund, which is third largest with 1.6 million members, ranks second in total assets.
Created in 1999 under the pension reform, the funds collect and invest a portion of an individual's contribution to the Social Insurance Office (ZUS). Individuals under 30 were forced to choose a private fund, while those 30-50 years old could choose whether to be part of the new system or stay with the old pay-as-you-go pension structure.
About 11 million Poles signed up for the reformed system and now are members of private funds, according to the Pension Fund Supervision Office (UNFE). However, that figure might actually be lower due to inflated numbers submitted by sales agents, said Sebastian Bojemski, UNFE spokesman.
The pension funds join a handful of banks such as Bank Pekao, Bank Przemyslowo-Handlowy (BPH) and Citibank (Poland) that already provide on-line services in Poland. Many financial institutions, though, have yet to offer on-line access to accounts, and still require customers to either make changes to their accounts over the phone or in person.
At many of the funds, internet users would be able to do everything from checking the status of their accounts to listing on-line payments sent by ZUS. Currently most of those functions are either handled in person or over the telephone. Joining the funds and making changes to individual contracts would still have to be made in paper form, however, as funds are required by law to submit any changes in writing.
"Our clients will be able to check the current value of their personal (pension) account, to change or to disable a password and to print all kinds of data-changing forms, since all changes must be requested in writing," Jarmuzewska said.
Many of the funds interviewed for this article were cagey about when exactly they planned to offer on-line customer service and access to accounts. But funds' interest in the medium is building and many are expected to go on line within the next year.
Pension fund Arka-Invesco is one of those looking at the internet. Rafal Andrzejewski, president of Arka-Invesco pension fund, said that his company plans to begin crafting a web strategy in April, with the idea of having on-line account access by the middle of the year.
"On the one hand, a lot of people would prefer to make calls (to get some information), but on the other hand, it can be a treat for young people," Andrzejewski said.
The Office Service for Investment Funds (OFI) is trying to take advantage of the internet interest by pushing its own application, called e-fund. OFI, a transfer agent handling fund-member accounts, cooperates with four investment funds and two pension funds Nationale-Nederlanden and Bankowy.
U.S.-based Forum Financial Group (FFG), one of OFI's shareholders, designed the application while FFG Polska developed it for the Polish market, said Marek Ratajczak, development director at OFI. The software allows fund members to view their account details and also gives them a history of payments from ZUS, he said.
"Of course pension funds can do that on their own, but what for? Our product already exists," Ratajczak said. "Our application is ready for investment funds, and at the beginning of the second quarter of this year we'll start up on-line customer service" as well.
Aleksander Frydrych, vice president of the Polish Chamber of Information Technology, said that while users may be concerned about the safety of viewing account information on line, they shouldn't be. He said that digital internet connections are in many ways more secure than that of traditional analog telephones. Digital connections break information into bits of electronic bleeps, while analog actually contains sound waves. The electronic bleeps are usually more difficult for outsiders to tap.
Frydrych said that as the pension funds try to lure members from each other, they should take advantage of the more than 2 million people in Poland who actively use the internet.
"Perhaps this gave pension funds some ideas," he said. "Internet users are mainly young ones and for some of them it would be easier to reach a pension fund (by internet) than by phone."
