Age Wage, a new defined contribution comparison service, is expected to be up and running in June this year.
The fintech company, which will soon enter the Financial Conduct Authority sandbox, will be launching an app which will allow savers to receive a score for their pension, and switch to another provider if they’re not happy with their results.
Through an app, savers will be able to see the value of their pot, how it compares to a benchmark, and receive an overall score for their pension (up to 100).
Pensions expert and founder of the Pension Playpen, Henry Tapper, is chief executive of the company, which he created alongside Chris Sier, chairman of the institutional disclosure working group at the FCA.
Mr Tapper said: "Most people don't have an idea of how their pension saving is getting on. They’ve nothing to compare their experience to, and so statements about value for money don’t mean much to them.
"We hope to provide millions of Age Wage numbers to people by working with independent governance committees, insurers, master trusts and self-invested personal pension [providers]. The numbers will give a consistent picture of how people's pensions are doing.
"Our aim is to build an app used by millions, and make that app the gateway to proper information, on which ordinary people can make solid decisions about how to save and how to spend their pension pots."
Mr Sier said: "We are launching Age Wage to ensure that the millions of savers who aren't currently taking advice, have an insight into how their savings are doing.
"We would like to become a touchstone for ordinary people looking for clear and impartial information on their pension options."
Mr Tapper told FTAdviser that Age Wage already has all the technology in place, and is now looking to raise £200,000 to create the infrastructure around it.
The fintech company launched a crowdfunding raise through leading investment platform Seedrs today (March 18).
Age Wage will score savers pensions by calculating an internal rate of return for each pot, which will then be compared to a benchmark.
This will consist of a portfolio of allocations or weights of total return indices, which vary over time. The portfolio will be rebalanced annually to reflect changes in weights, the fintech company stated.
Age Wage's business model will rely on charges to providers once savers switch their pension pots to these companies.
This will average £100 and be paid by the pension provider the consumer transfers funds to.