ING Direct's new superannuation product, Living Super, is the "inevitable outcome" of the Government's reforms to the industry, according to Minister for Financial Services and Superannuation Bill Shorten.
The minister spoke at the official launch of Living Super yesterday at ING Direct's offices in Sydney.
"ING and the Government are animated by the same common objective: we want people to maximise their retirement income. We're interested in how we exert downward pressure on fees, and how we increase competition," Shorten said.
ING Direct chief operating officer Anne Myers said the product was the result of customer research that showed people wanted more control, online functionality and better value from their superannuation.
"The sentiments of value and simplicity come through strongly in the MySuper reforms and we applaud this," she said.
The balanced option within Living Super is available with no administration or management fees. Cash and term deposits held with ING Direct also attract no fees.
According to Myers, ING Direct benefits from the balanced option by lending out the cash component to mortgages - the "normal way banks make money".
Customers can also select from a range of indexed managed funds (provided by State Street) as well as real-time share trading (via Core Equity Services). These services attract fees, along with a 'buy/sell' spread.
Initially, the distribution for Living Super will be completely online and phone-based, said Myers.
ING Direct is also looking at offering the product through the adviser channel, which would be on a fee-for-service basis.
"It's difficult to offer a zero-fee product if you're operating on commission," she added.