Protecting Pensions: Leveraging digital technology to tackle fraud, cut costs & support better decisions.

#InnovationIsInOurDNA

New partnership between Civica and GBG, an identity verification, location intelligence and fraud prevention company, will enable pension providers to make best use of data to protect members interests, whilst streamlining processes.

Civica Pensions Managing Director Chris Jones and GBG Director for Wealth, Life & Pensions, Spencer Lynch discuss some of the benefits digital technologies provide in reducing risk in the pension sector.

Companies across the UK are undergoing a period of digital transformation which is far from straightforward. By understanding some of the barriers to digital transformation, businesses can approach them in a pragmatic, risk-based way, enabling them to easily identify the areas that technology can enhance.

Quite often in regulated industries like pensions, the main motivation for the deployment of cutting-edge technology is mitigation of fraud risk. Whilst that’s a significant underlying driver, there’s other benefits that the adoption of this technology provides that may not be initially apparent. Among these, according to Civica Pensions Managing Director Chris Jones, are “member experience, significant reduction in operational costs and risk of reputational damage”.

Chris points to the example of the operational cost of having to return documents that have been posted, especially when returning sensitive documents like marriage certificates, birth certificates and sadly even death certificates. The risk of those documents being lost in the post, is one that should not be overlooked.

Reducing risk with technology

Where technology can really help reduce risk in the pension sector, is enabling members to submit documents digitally within seconds and performing extensive integrity checks, quickly and silently. Digital technology, according to Spencer Lynch of GBG, can enable us to challenge BAU processes, transform them and significantly reduce the risk associated with common life ‘events,’ such as name changes from marriage and/or divorce. Spencer points out that “if we make it easy for members to interact with their funds, the natural result will be that user adoption will increase”. Chris Jones agrees, highlighting that “Technology provides us an ability to engage members in keeping their data up to date and current”. This engagement is key in the industry, especially when we start looking ahead to The Pensions Dashboard.

If we want to know where a member lives – ask the member. If we want to know where a member has worked, to enable the repatriation of lost assets and/or allowing administrators to identify potential duplicate records across their estate – ask the member. Spencer Lynch reiterates, “an engaged membership happens when confidence in the members identity is high, this solves many of our underlying industry challenges”.

Exposure…

From a fraud perspective, the pension industry is exposed to the risks associated with typical ID&V processes more than others. That’s the anti-impersonation part. In many markets we see this anti-impersonation piece being overcome with what’s widely referred to as a KBA (knowledge-based authentication), questions only the member should know the answer to. The general premise of this is good, but in our industry, it’s more susceptible to compromise. Previous relationships compound the issue. But by leveraging sophisticated identity verification checks, that use biometric technology and quality data, organisations can be confident that they know the identity of the person and any risks associated. By better understanding the identity of the person it’s easier to prevent fraud, while making it easier to quickly let the ‘good’ people in. Civica continues to take advantage of advances in cyber-security to develop cutting-edge, sophisticated document checks and identity services that allow funds to assure members that trustworthy security controls are in place - guaranteeing the protection of pension transactions.

#TrustedPartner - giving you the assurance that you and your members need.

Civica provides pensions administration software and consultancy services across the private and public sector including 44% of Local Government Pension Schemes in England and Wales. Their latest contracts with Southwark Council and Local Pension Partnership Authority builds on strong momentum and growth in the sector. Civica's new inspiring content series, Perspectives* explores how emerging technologies can help us build more innovative public services for today, and tomorrow. Get in touch for more information.