Banks best placed to trigger super switching
Bank-employed advisers are the main trigger for industry fund member leakage points, according to a new report by CoreData.
Retail and bank-owned funds are leading the way in the growth of super fund members by leveraging their banking networks rather than acquiring new members through fund mergers.
According to the report, bank-employed advisers contacting members to discuss super is appealing to one in five members. This may not be a high absolute number, but it represents a substantial proportion and should be of concern to not-for-profit funds.
CoreData Head of Advice, Wealth and Super, Salvador Saiz said: "The growth in low cost super products by the banks in particular and efforts by these in poaching industry fund members by leveraging their banking networks appears to have had some success given that a large number of industry funds regularly name at least two low cost retail funds as main leakage points."
Banks selling super over the counter will be the next challenge for industry funds, as banks look to leverage from their face-to-face engagement with customers by training bank tellers to sell low cost super products.
Whilst there is no clear banking leader across all channels for selling super, members are split by their individual banking provider. When gauged on their interest in being sold super by their bank teller, St George Bank leads, while Bendigo Bank customers prefer contact from a financial planner.
Hard-copy and email communications from banks are currently the most popular channels to sell low cost super.
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