An oligopoly exists among European pension providers because of how the continental pension system works.
As it stands, workers are only eligible for pension products offered by providers in their country of residence. For smaller nations like Ireland, options are limited to a handful of funds and schemes.
With the introduction of the PEPP, European citizens will be able to pick from pension providers in locations across the EU.
This will likely make the industry more competitive, driving prices lower and encouraging technological advancements – all in all, it benefits EU citizens looking to invest in their pensions.
When stock trading moved to the online sphere, the market became cheaper, more accessible and easier to use, largely because of technological improvements in the industry.
Platforms like Trading 212, eToro and Revolut emerged, offering lower rates than their traditional competitors and changing the market forever.
The PEPP has the potential to make a similar impact on the world of pensions.