Super returns strong, but funds need to elevate trust, member experience, and retirement

19 May 2026

• Australia’s superannuation system now manages more than $4.5 trillion, around 150% of GDP, cementing its global significance.
• Funds have delivered another strong year, with the median growth fund returning 10.5% in FY25.
• Challenges remain around reinforcing trust, prioritizing member experience.

Australia’s thriving superannuation system now holds $4.5 trillion in assets, amounting to around 150% of the nations GDP. More than 95% of those assets are now held by the 24 largest funds.

According to KPMG’s 2026 Super Insights report, which looks at recent data from APRA, the number of funds with more than $100 billion in assets, known as mega funds, has risen to 11, up from just eight funds the prior year.

“As the system grows and mega funds continue to emerge, the winners will be those that can convert scale into consistently better outcomes, which includes not only a strong performance, but also stronger member experiences and robust safeguards,” said KPMG Superannuation Advisory Lead Dr Lisa Butler-Beatty.

The report, which examines the factors shaping Australia’s superannuation sector, highlighted that funds delivered strong investment returns in FY25, with the median growth fund returning 10.5% for the period.

Those strong returns came despite being one of the most consequential in terms of investment governance scrutiny, regulatory intervention, and structural pressure on superannuation trustees.

The report also found that trust now rests on both resilience and service. Recent cyber and fraud incidents have resulted in high expectations for system-wide protection, it said.

“We’ve seen coordinated attacks and widespread credential theft across the sector, alongside fraudulent withdrawals and identity-based scams, which has driven urgent action by both regulators and super funds to better protect members.”

“Regulators are sharpening their enforcement focus on member servicing and in response funds are investing heavily in digital capability to meet member expectations. AI continues to be a priority topic for regulators with APRA outlining expectations on AI governance, risk and assurance and ASIC calling for action on cyber resilience in response to the impact that new advances in AI technologies could have on security vulnerabilities.

But the retirement challenge is becoming more urgent, as more members approach and enter drawdown, placing pressure on funds to adapt, and quickly.

Retiree balances are set to grow from around $100bn to $140bn within five years, yet only 1% currently sit in lifetime income products, highlighting a major challenge as Australia’s retiree cohort expands, the report said.

“Funds will need to deepen retirement engagement, improve guidance and communication, and continue evolving product and servicing models to support members’ transition from accumulation to income, while meeting higher expectations for transparency, support and value,” Dr Butler-Beatty said.