How this Indian IT company is helping the US retirement plan industry pivot to the cloud

Soma Tah

Rising fee structures and healthcare costs along with an ageing population have intensified pressures on the US retirement plan industry ecosystem in the last few years. On the plan administration side, the industry has to service diverse demographics, manage for the trough-and-peaks- making planning for resources very difficult. The industry is facing razor-thin margins due to transparency in pricing. The major challenge is to control the operating costs to be profitable and viable. 

But, the industry is severely handicapped as it depends on age-old applications built on legacy platforms that are difficult to manage. The systems and processes also have to be constantly updated to be compliant with ever-changing regulations. Also, online services are increasingly coming under scrutiny for the unauthorized collection and misuse of user data giving rise to consumer concerns about privacy. Since retirement plans involve a lifetime of savings, any sort of data theft would probably mean a loss of livelihood and trust.  

The move to adopt contemporary technologies can significantly increase efficiencies and bottom line while enabling the industry to provide a better customer experience to plan participants and plan sponsors, said Vaidyanathan Chandrasekaran, Chief Strategy Officer, Congruent Solutions. With 16+ years of expertise in this industry, Congruent Solutions has become the partner of choice for leading plan providers, record keepers and third-party administrators, which includes Fortune 500 companies  He speaks more in detail about the challenges that the US retirement plan industry is facing currently, and how it has been transforming the retirement plan industry in the US with its technology solutions.

How did you start your journey as a solution provider for the retirement plan industry and what are some of the unique product/solution offerings?

Congruent Solutions started its journey in the retirement plan industry through an outsourced product development (OPD) opportunity for a technology company focused on the sector. This experience played an important role when we began our own record-keeping platform development years later. In the next couple of years, we set up our outsourced plan administration division. We began this service with Compliance Testing which is one of the most complex processes in a retirement plan’s administration lifecycle. A couple of years back, we hived off our horizontal IT services division into a separate organization and decided to focus completely on the retirement plan industry. 

Our key offerings include Outsourced Plan Administration, CORE Suite of Solutions and Retirement technology services. Adapting to contemporary platforms, like Congruent’s CORE suite of cloud-based modular middleware services and record-keeping platform, can help companies manage the tightrope walk between cost pressures, Consumer demands and compliance needs. Increasing Self-service adoption is the key and this is where CORE with AI components makes a significant difference to its customers.  

To what extent the industry has been digitized so far? What kind of technology innovation is needed further to enhance the experience of the plan participants and the plan sponsors?

While the technology investments have been high in the retirement plan industry, unfortunately, they are built on legacy platforms that can be difficult to manage and cost extensively. The legacy systems are mostly batch-oriented and have rigid infrastructure requirements and immobility. Catering to the evolved demographics and keeping up with the ever-changing compliance needs, can be a daunting task for companies.

While other segments within the financial sector have adopted cloud-based solutions, the retirement plan industry is at a very nascent stage. The industry is risk-averse and doesn’t want to rip-and-replace their existing platforms. This was one of the reasons why we built our CORE suite as modular. Our customers can decide to address one problem at a time and develop confidence on a cloud-based platform before deciding to replace their existing systems. This will increase the effectiveness and scalability of businesses to a large extent while assuring Business Continuity during the transition.

Could you please tell us about your platform and the features in detail?

Congruent’s flagship offering is the CORE suite of cloud-based record-keeping platform that offers a holistic solution to manage, administer and maintain retirement plans. It empowers the retirement plan providers to deliver better CX to their plan sponsors and plan participants.

We recently unveiled CORE 2.0. Built on microservices architecture and with a modern UI, CORE 2.0 offers great performance and seamless user experience to all stakeholders on all devices. The CORE 2.0 is built on a microservices architecture that breaks the monolithic record-keeping system into loosely coupled, yet tightly integrated, logically grouped, and independently deployable smaller components. This results in cost efficiencies and great performance. The fully responsive UI is powered by ReactJS based components. The application will load faster, perform better, and offer consistent user experiences across all devices including the mobile ones.

Can emerging technologies such as blockchain, automation, AI/ML, etc. help the industry?

Digital transformation has already disrupted the way the retirement plan industry functions. for an ecosystem that deals with huge amounts of sensitive data, embracing Cloud-based platforms, automation, data retention solutions, Blockchain, AI, mobile check deposits, and web chatbots can be the key to future growth. 

Integrating AI into customer relationship management (CRM) systems can help providers capture and leverage big data, helping participants to build personalized plans based on intelligent insights. AI/ML also helps record-keepers to streamline back-office tasks with automation, greatly reduce errors in the data processing and can enhance customer support. The usage of AI with traditional security techniques are also major resources to detect threats quickly amongst millions of vulnerable events.  Blockchain is yet another tool that can be leveraged in order to standardize and streamline the retirement plan processes through data security, data democratization, and participant ledgering. 

Could you please share the company's vision for growth?

We, at Congruent Solutions, thrive to build products and technology solutions that can empower the retirement plan industry worldwide to help every citizen prepare for their retirement lives. Our vision is that the retirement plan industry pivots from using legacy platforms and technology to contemporary cloud-based technology. This will enable them to provide a better customer experience (CX) to their customers – plan sponsors and participants. It will also help them address the inherent challenges of using legacy platforms which include higher cost of operations and rigidity in compliance. 

We want to make the CORE suite the record-keeping platform of choice for the global Defined Contributions sector. From a business point of view, we have witnessed a 30 percent+ revenue growth in the last financial year and are confident of achieving growth of 40 percent in the next. In the same period, we also almost doubled our headcount from 170 to 300 plus employees now. We have set ourselves a 5X growth target by 2025.