How the new European fund product works

Frankfurt guarantees cost. And in view of the persistently low interest rates, they can hardly be paid for in old-age provision, as the criticism of ever lower returns on endowment life insurance and also on the subsidized private Riester provision shows.

A new European fund product for private old-age provision without a capital guarantee and with limited costs called PEPP (Pan-European Personal Pension Product) is now intended by the European Union to remedy the situation. The product launches this Tuesday.

With the so-called Delegated Regulation 2021/473 of the EU Commission on the last details about costs, risk modelling, technical regulation and product information, PEPP, which is also called “Eurorente”, comes onto the market (according to EU Regulation 2019/1283). Financial providers can now apply to their supervisory authority for approval for such a fund and, after further registration, offer it throughout the EU.