Dutch pension administrators APG and PGGM have successfully completed the first phase of a joint experiment involving the development of a pension administration blockchain application.

The two parties will now be conducting further research with this prototype. Over time, the continued development of this prototype will produce a more flexible and transparent pension administration system at considerably lower costs.

APG executive board member Wim Henk Steenpoorte said: "We aim to create the maximum possible value for pension funds and their members. By investing in smart applications, such as blockchain, we make our pension administration simpler and cheaper over time.”

PGGM executive board member Paul Boomkamp, added: "With this experiment we are building the pension infrastructure of tomorrow for our clients and their members. It is an important step that we are able to take with the support of our largest client, PFZW. The first
results make us excited and curious to learn and explore even more.

"Ultimately, this experiment has to show that blockchain technology has the potential to manage a policy administration at lower rates. It is an excellent development that two of the largest pension administration organisations are joining forces to work on this kind of innovation."

The expectation is that blockchain technology has the potential for significantly improving the services pension funds provide to their members. A key objective is to lower member costs and to simplify pension administration, and make it more secure. In addition, the personal pension data will be become more accessible to members.

APG and PGGM said the first results are very promising and at the same time, there is still much to learn about blockchain and the opportunities for pensions. In the coming period PGGM and APG will therefore continue the blockchain project. In the next phase, talks are held with various parties in the pension industry such as pension funds, regulators and information providers.

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