Scheme members are reluctant to engage with their pensions using artificial intelligence and other forms of technology, according to Trafalgar House.
The administration specialist’s latest Trust and Confidence Index research found that only one in six people say they would be happy to engage with chatbots while interacting with their pension provider.
Trafalgar House said this showed that the pensions industry had a long way to go to engage schemes and members with AI technology, new research has found.
Although AI was becoming increasingly prevalent in many daily interactions, the company said, most providers had yet to integrate this kind of technology into communication processes.
As such, Trafalgar House’s research showed that members remained either non-committal or negative on the topic of technology.
Only around one in six people said they would be happy to engage with chatbots while interacting with their pension provider. Of the 2,000 people polled, 39% said they would prefer not to use this technology and 24% would not use it at all.
Daniel Taylor, client director at Trafalgar House, said: “While the results definitely show there is a broader acceptance of technology beyond simple online communications, it’s also clear that a large proportion of members are not yet ready to say goodbye to older, more traditional ways of communicating, even if newer and more innovative methods are available.
“This is likely linked to the broader ongoing mistrust of the pensions industry. With people willing and able to complete other important life-defining financial transactions online – such as mortgages, loans, and investments – there’s no reason why pensions shouldn’t be the same unless it’s down to an underlying issue with the industry itself.”
Diverse needs
Taylor added: “Digital innovation offers a promising avenue for achieving greater clarity and a significant portion of members are open to engaging digitally with their pensions, attracted by the enhanced speed and accessibility of online, mobile and interactive pensions.
“What’s also clear is that diverse approaches are vital, and the industry must continue to cater to various member needs – a single approach won’t work. Members want flexibility in the way schemes communicate and engage with them and to save and retire in a way that suits them.”
The results also showed that public trust in the pensions industry has increased for the fourth year running and is up to 5.26 out of 10. This is up from 4.95 previously.
However, members' confidence in achieving an adequate retirement income has fallen from 31.7% to 30.9%.
Although this is a relatively small drop, it marks an end to an increasing trend of people feeling they are able to meet their retirement needs and goals.
Results also showed that the most important factor for building trust with the public remained better communication.
Further reading
A vision for pensions in the digital age (21 August 2024)
Trafalgar House warns of admin ‘tech debt’ (6 August 2024)
Innovation Interviews: How Cardano embraces AI (26 June 2024)
