BlackRock is collaborating with Microsoft to build a retirement platform that would aim to help people save and invest their retirement income.
The platform, still in the early stages of development, will be built with Microsoft’s technology and offer BlackRock’s investment products, which the money manager will design and manage.
These new products will aim to provide retirement income to employees through their employers’ workplace savings plan, according to BlackRock.
The asset manager declined to give further details on the project, but according to a Wall Street Journal report, BlackRock will also engage in talks with insurance firms in order to create products similiar to annuities, and reach out to record-keepers and custodians to see if they would be willing to collaborate on the platform.
The idea for the collaboration came after a private meeting between BlackRock chief executive Larry Fink and Microsoft chief executive Satya Nadella in May. The two executives, who reportedly had a conversation about on how they could work together to solve the problem of declining financial resources for future retirees, have continued to speak about this matter, the WSJ report said.
One of the possible outcomes of the platform could be a mobile app, but BlackRock would not collect individual customer data through the app, according to the Journal.
As the largest money manager in the world, BlackRock had $6.4 trillion in assets under management at the end of September. It also oversees $1 trillion in defined contribution assets.
‘Retirement systems worldwide are under stress and providing financial security to retirees has become one of the most defining societal challenges of our time,’ said Fink in a statement.
‘BlackRock has a tremendous responsibility to help solve this challenge, and we recognize the need to act now. Working with Microsoft will enable us to build a powerful solution for millions of hard-working Americans.’
‘Today millions of Americans are struggling to achieve their financial goals for retirement,’ said Nadella, chief executive of Microsoft. ‘Together with BlackRock we will apply the power of the cloud and AI to introduce new solutions that address this important challenge and reimagine retirement planning.’
BlackRock has also been ramping up its digital financial planning capabilities. The firm most recently took a 4.9% stake in Envestnet as part of a deal that will see the asset manager's digital wealth technology integrated into Envestnet’s platform.