DPLK Association Proposes Strategies to Strengthen Pension Fund Industry

Three Key Recommendations for 2026

The Financial Pension Fund Association (DPLK) has outlined three critical strategies to maintain and enhance the pension fund industry's performance in 2026. According to Tondy Suradiredja, Chairman of the DPLK Association, these recommendations aim to improve investment performance and strengthen the industry's appeal.

1. Personalized Investment Options

The first recommendation is to implement personalized investment options tailored to individual risk profiles. Tondy emphasized the need to promote products like Life Cycle Funds that adjust risk based on participants' ages. This approach recognizes that different participants have varying risk tolerances and investment needs.

2. Diversified Investment Portfolios

The second strategy focuses on offering more diverse investment choices to participants. By expanding the range of investment options, pension fund providers can better cater to different investor preferences and risk appetites. This diversification is expected to enhance overall investment performance and attract more participants.

3. Strengthened Governance and Risk Management

The third recommendation emphasizes the importance of strengthening governance and ensuring strict adherence to risk management and investment compliance. Tondy stressed that robust governance is crucial for maintaining participant trust and ensuring the long-term sustainability of pension funds.

Growth Projections for 2026

The DPLK Association projects that the industry will experience 6-8% growth in managed assets and 4-7% growth in the number of participants in 2026. These projections are based on trends observed over the past three years. Tondy noted that while there is potential for growth in the informal worker segment, corporate participation is expected to drive the majority of new enrollments.

Challenges Ahead

Despite the positive outlook, the industry faces several challenges in 2026. Tondy identified three key issues: low financial literacy among the general public, global economic uncertainty impacting investment returns, and purchasing power constraints affecting voluntary pension contributions. Addressing these challenges will be crucial for the industry's continued growth and success.

Future Opportunities

The DPLK Association sees potential for increased participation, particularly if more attractive tax incentives are introduced or if pension products become more flexible and tailored to individual needs. Enhancing financial literacy through digital platforms and promoting the value proposition of pension funds will also be essential for driving growth in the industry.