Modernising super while keeping fees low

Customer expectations in the digital age

Australia’s superannuation funds can no longer afford to delay digital modernisation. Rising member expectations, growing retirement balances and a rapidly expanding retiree population are increasing demands for better services while maintaining low fees.

40 years ago, superannuation covered only about 30% of Australian employees. The Prices and Incomes Accord laid the groundwork for broader coverage, followed by the introduction of the Superannuation Guarantee (SG) in 1992.

By the end of 2024, coverage exceeded 90% and total superannuation assets had passed $4 trillion, including $2.9 trillion in APRA-regulated funds. The SG rose to 12% from July 2025.

In their early development, industry funds rightly focused on investment performance and low fees, particularly while member balances were modest. Engagement generally increases as balances approach $250,000 and rises further around $500,000, often as retirement nears.

That focus made sense when most members had relatively small balances and limited reasons to engage regularly. But as balances grow, super becomes a more significant household asset and members expect more support to understand their options and prepare for retirement.

Modernising superannuation

The industry is now at another critical point. In 2025, around 40% of retirees had more than $250,000 in superannuation at retirement. By 2035, more than half are projected to have over $500,000 in today’s dollars. For many Australians, superannuation will become their largest financial asset outside the family home, increasing expectations for service, support and confidence in decision-making. 

More than 3 million Australians aged 55–64 are approaching retirement in the next decade, with another 3.3 million following in the decade behind them.

Funds urgently need stronger retirement income and engagement strategies, including the right products and better help, guidance and advice. Members need confidence to make decisions and spend their savings, particularly during the earlier, healthier years of retirement.

This shift is not simply about offering more products. Funds must help members navigate complex choices, understand the trade-offs between income and flexibility, and feel confident drawing down their savings.

Changing expectations with data and technology

As balances rise, rapid digitisation has changed how members interact with their super. Portals and mobile apps provide easier access to information, lifting engagement and expectations of service.

At the same time, regulators are exposing and penalising poor practices, including unnecessary delays in processing insurance claims.

In this increasingly competitive environment, best-in-class member services are emerging as a third pillar alongside strong investment performance and low fees.

That requires intuitive and secure digital experiences across channels, supported by accurate data and timely human assistance when decisions become more complex. Members increasingly expect the same ease and personalisation they receive from banks and other digital service providers.

In its October 2025 paper, Delivering member outcomes into the future, APRA said trustees must invest in operational and cyber resilience and better support members approaching retirement, while ensuring expenditure remains in members’ best financial interests.

APRA also warned that continuous investment in systems, capabilities and governance must be delivered efficiently to avoid undue upward pressure on member fees.

This creates a genuine tension for trustees. Underinvestment can leave funds with ageing systems, fragmented data and poor member experiences, but transformation programs that are not well governed can increase costs without delivering clear benefits.

Digitisation to service the masses

Over the next five years, digitised service models will be essential for large superannuation funds. The challenge is to fund technology, data and process improvements quickly enough to meet member expectations while keeping fees under control.

Modernisation is increasingly necessary not only to improve member outcomes, but also to maintain efficiency and keep fees low over the long term. As member expectations rise and regulatory obligations become more demanding, many technology investments are becoming essential infrastructure rather than discretionary expenditure.

Funds will need to prioritise transformation projects across product innovation, distribution, streamlined processes, member services, compliance and risk management. Funding decisions should align with long-term strategy.

To remain competitive, funds will need funding models that support digital initiatives over multiple years rather than treating modernisation as a one-off program. Investment should improve member experiences, regulatory compliance, operational resilience and growth while reducing exposure to operational and cyber risk.

Some projects will deliver clear productivity gains and immediate savings, including lean methods that streamline processes and reduce waste.

Selective outsourcing and technology partnerships can also improve agility, provide specialist expertise and reduce upfront costs, releasing resources for core investment management and member services.

These options are not substitutes for internal capability. Funds still need the expertise to set strategy, govern suppliers, protect member data and ensure outsourced arrangements remain aligned with members’ best financial interests.

Other investments in data, privacy, fraud prevention and cyber security may offer little immediate financial return but remain foundational to member and regulatory expectations.

Prioritising member outcomes

Trustee boards must be accountable and empowered to prioritise member outcomes. Strong, adaptable governance will be critical as funds reshape their strategies and operations.

Many benefits of modernisation, including stronger risk management, member satisfaction and retention, emerge over time. Boards therefore need disciplined measures of success from the outset, including faster service, fewer complaints, stronger security, better retirement engagement and lower operating costs. Funds can support sound decisions by focusing on four areas:

1. Stakeholder engagement and market research: Identify member priorities and concerns.
2. Enhanced data analytics: Target technology and AI investment where it can deliver the greatest member value, efficiency or risk reduction.
3. Prioritise member outcomes: Focus on initiatives aligned with member needs and regulatory requirements.
4. Best Financial Interest Duty analysis: Test investments against measurable savings, member benefits, compliance and risk outcomes.

Australia's superannuation system has been built on two enduring strengths: strong investment performance and low fees. Over the next decade, a third capability will become equally important: the ability to deliver secure, personalised and efficient member experiences at scale. Funds that modernise successfully will be better positioned to improve retirement outcomes, meet regulatory expectations and maintain competitive fees. Those that fail to adapt risk falling behind in an increasingly digital and member-focused environment.