Background: In 2024, the DCIIA RRC conducted two online recordkeeper surveys to better understand their retirement income and distribution capabilities. Eighteen recordkeepers were surveyed with a large range of participants and assets under management. This week’s Research Minute, part three of the series, will more closely examine technological development needs and the role of middleware.

Findings: One of the main challenges in introducing new retirement income solutions is the high technological development needed to support each solution. Any given retirement income solution may come with a very different set of rules and regulations, which require recordkeepers to develop and code large amounts of new software for each solution. The result is a significant bandwidth burden, particularly if multiple solutions are offered. This is a critical consideration for recordkeepers, as technical support requirements are a top consideration (71%) when implementing new solutions.

Middleware and other partners can build 'open architecture' infrastructure that allows a given solution to be supported across multiple channels, which eases the burden of each recordkeeper having to code new connectivity modules to exchange data within the systems of the solution provider. It allows recordkeepers to focus on business strategy and solution communications rather than technology burdens, which is helpful if resources are lean.

A result of this ‘open architecture’ infrastructure is simplified delivery paths and expedited time-to-market of new solutions.

Bottom line: There is a significant burden on recordkeepers in managing the technical demands of implementing and maintaining new retirement income solutions. Notably, recordkeepers managing substantial assets are increasingly turning to middleware and open architecture systems to streamline integration and reduce the technology load.