I hit my favourite café for a half price coffee this morning. Eating out to help out in my own small way. As usual I was presented with a QR code to scan. That took me to a web page where I logged my name and phone number for tracing purposes.
QR codes have been around since the 1960s; as we come out of lockdown they seem to be everywhere. QR stands for Quick Response. Essentially, it’s a type of barcode which, when read by your smartphone camera will take you directly to a website, video or an app, without the need to type in a fiddly web address.
Old age thinking …
We’re now using QR codes to take DB members to our pensions app. It’s a simple experience. Open the camera, point it at the code and it takes you to the Apple App Store or Google Play.
I showed it to a trustee about six months ago. “Our members won’t use that” he said. Unfortunately, that’s an all too common reaction to new technology in the DB pensions arena. The membership demographic is older, the trustees are often older and they hold the perception that it’s only 20-year olds who use smartphones and apps.
Right now, if a DB scheme member wants to order food at a restaurant, they are probably using QR codes to access the menu! There is no doubt that the current pandemic has accelerated certain trends; one in particularly is the move to online.
Why wouldn’t DB members want the same sort of experience from their pension scheme as the one they can get from the retail and hospitality sectors, or indeed other financial services?
Alistair McQueen, Head of Savings & Retirement at Aviva, picked up on this issue recently on Twitter, further discussed in Henry Tapper’s excellent blog. The fact that 76% of people now bank online is clear evidence that there is both the appetite and capacity to transact digitally.
Breaking down barriers …
I’d go further. The Deloitte Digital Survey (UK edition, Deloitte Mobile Consumer Survey 2019) shows that in the 45-65 age group smartphone ownership is around 80%. Apps are now the way that most people access the internet.
Some trustees may be reluctant to adopt new technology but it could be argued that they have a duty to ensure that they do not act to the detriment of their members and are not the first barrier to better digital engagement.
The next barrier to getting members online is the registration process. Two factor authentication and remembering passwords are often cited as problematic. Experience shows that if you make something easy people will use it. For example, the QR code used to get to the app store is personalised like a password. That means a much quicker and easier process to register for the first time. In our initial testing, 99% of people successfully used the QR code to register.
Designing an app for smartphones means that we can work with their inbuilt security features, such as fingerprint and facial recognition. Once registered, a customer can access the pensions app like any other app on their phone.
From stone age to digital age to engage …
We are in the customer testing stage of the app which allows members to manage their benefits from their smartphone. Everything is possible, from a change of address to viewing benefits, to retiring. Initial feedback is that it gives members what they need in the way they want it.
The other benefit is the potential cost saving to the scheme. Our modelling suggests that as much as a 30% saving in administration cost is possible. Some or all of that could be passed onto the scheme. But only if we can get trustees to realise that “their members will engage”.