Wilmington Trust has introduced the BoardingPass application to digitize and streamline the onboarding of collective investment trusts for employer-sponsored retirement plans.
The company hopes the application will increase the availability and use of CITs for employer-sponsored retirement plans by removing paperwork and implementing a digital onboarding process.
The paper-based onboarding process is onerous for employer-sponsored plans wanting to use CITs, explains Rob Barnett, head of Wilmington Trust retirement distribution and product leader for CIT business, because a plan’s eligibility to invest in CITs must be confirmed through a retirement plan participation agreement.
“To invest in a CIT, a plan sponsor or its delegated fiduciary has to complete a participation agreement that really represents and warrants that they’re eligible to invest in this tax-qualified vehicle,” he says.
“That has left a lot of people to believe that the onboarding process for CITs must stay paper-based, and while we all work continuously to try to make the paper-based process better, it really doesn’t allow for the democratization of the use of CITs. BoardingPass brings to pass the democratization of the retirement plan onboarding process, as well as adding CITs as plan options.”
The app serves as a central hub for all plan information. Wilmington Trust says rather than requiring an employer-sponsored plan to manage reams of paperwork, which can lead to errors and takes an average of one to five business days to submit, users of the web-based platform can shorten the timeline by up to 80 %.
Plan adviser users of the tool can automatically pull key data for the plan they are advising into the system from the data contained in the IRS Form 5500 database; a Form 5500 is the annual report filed by employer-sponsored plans with the Department of Labor. The tool prepopulates the correct form fields with information on a plan’s financial condition, investments and operation.
Plan sponsors may be able to gain the benefit of real-time information-sharing and a digital connection to their critical service provider partners, according to a press release.