Cape Town-based asset manager Allan Gray launched an umbrella retirement fund in March, adding another player to the increasingly competitive retirement market space.
Umbrella retirement funds are funds that serve multiple employers, unlike traditional stand-alone employer-sponsored funds.
More and more employers are going the umbrella route, largely because of the increasing burden of administering a retirement fund and having to comply with burgeoning regulation.
Saleem Sonday, the head of group savings and investments at Allan Gray, says the South African retirement industry today (excluding the government pension fund) manages assets of around R1.8 trillion.
Of this, around 49 percent is in non-commercial funds, 17 percent in commercial umbrella funds and about 34 percent in individual retirement annuity accounts and preservation funds.