All about pan-European personal pension products (PEPPs)

Saving for retirement across Europe has become an increasingly pressing issue, with roughly 20% of EU citizens at risk of poverty or social exclusion in old age, according to EIOPA (the European Insurance and Occupational Pensions Authority). To tackle this challenge, the European Commission and EIOPA introduced the Pan-European Personal Pension Product (PEPP) – a voluntary, portable, cross-border pension framework designed to complement existing national pension systems and help close Europe’s substantial retirement savings gap.

This article gives you a complete explanation of how the PEPP works, what advantages and limitations it offers compared to local alternatives, and how to decide whether it’s a suitable retirement savings option for your long-term goals.

What is a PEPP?

A PEPP (Pan-European Personal Pension Product) is a voluntary, long-term personal pension savings vehicle available to residents of the European Union. Created under Regulation (EU) 2019/1238 and supervised by EIOPA, the PEPP runs alongside (not as a replacement for) existing national pension programmes such as:

• PPR – Plano Poupança Reforma (Portugal)
• Riester-Rente, Rürup-Rente, and bAV (Germany)
• PER – Plan d’Épargne Retraite (France)
• SIPP – Self-Invested Personal Pension (UK, though the UK is no longer in the EU post-Brexit)
• PERE – Plan de Previsión Asegurado / Planes de Pensiones (Spain)
• IKE and IKZE (Poland)
• PPK – Pracownicze Plany Kapitałowe (Poland – employer-based)
• Pensionssparen (Denmark)
• IPS – Individuellt pensionssparande (Sweden)

The PEPP is designed to be portable, transparent, and cost-effective, with the kind of tax-advantaged treatment you’d expect from a personal pension product. The key innovation is cross-border portability: a German resident could invest in a PEPP offered by a Spanish or Lithuanian provider, take that PEPP with them if they move to Italy or the Netherlands, and con

How does a PEPP work?

The PEPP is a separate, complementary pension layer – distinct from both state-based pensions (the public pension system) and occupational pensions (your workplace pension). It provides EU residents with an additional, optional vehicle to save for retirement, with all the cross-border flexibility and standardisation the EU’s single market enables.

The PEPP framework is based on Regulation (EU) 2019/1238 of the European Parliament and Council, which came into force in March 2022. The regulation created a harmonised single market for voluntary retirement savings across the EU – conceptually similar to how 401(k) plans work in the US, but adapted to the EU’s multi-country regulatory landscape.

The PEPP is designed to encourage long-term saving and investment, which supports two broader EU objectives: providing citizens with a credible private pension pillar to complement state and occupational pensions, and channeling more long-term capital into EU capital markets to support productive investment.

PEPP fees and costs

Specific fees vary by provider and product configuration, but the PEPP framework imposes a critical consumer protection: total annual costs are capped at 1% of the saver’s accumulated capital for the “Basic PEPP” default option. This cap covers administration, asset management, and distribution costs combined – making the Basic PEPP one of the most cost-controlled pension products in Europe by design.

Higher-cost investment options (with more sophisticated strategies, advice, or insurance components) can sit alongside the Basic PEPP within a single provider’s product range – but the Basic PEPP option must always remain available as the default, fee-capped choice. This structure ensures cost-conscious savers always have access to a transparent, low-cost option regardless of the provider they choose.

Who can provide a PEPP?

Under the PEPP regulation, the following types of financial institutions are eligible to offer Pan-European Personal Pension Products:

• EU-authorised credit institutions (banks)
• EU-authorised insurance undertakings
• Institutions for Occupational Retirement Provision (IORPs)
• Investment firms providing portfolio management services
• EU UCITS management companies
• EU Alternative Investment Fund Managers (EU AIFMs)

Despite this broad range of eligible providers, PEPP adoption has been notably slow since the regulation came into force in 2022. As of recent reporting, only a handful of providers actively offer PEPPs on the EIOPA central register – significantly fewer than the European Commission anticipated. This has been attributed to several factors including the patchy tax incentive alignment across member states, the 1% Basic PEPP cost cap that discourages traditional distribution channels, and limited consumer awareness.

The most well-known PEPP provider to date is Finax, a Slovakia-based wealthtech firm:

Finax PEPP features:

• Start investing in your PEPP from just €10 per month.
• Annual management fee of 0.6% (+VAT, totalling around 0.72%) – well below the 1% Basic PEPP cap.
• A managed investment portfolio using Finax’s robo-advisory technology, with allocations that adjust and rebalance automatically as you age (lifecycle/glidepath approach).
• Underlying investments use broad-market ETFs covering global stocks and bonds for proper diversification.
• Fully online and mobile management.
• Portable across EU member states if you relocate.
• No entry or exit fees.
• Employer referral programme:</str
  

Who is the PEPP for?

This cross-border pension product is open to a wide range of savers and investors between adulthood and retirement age:

• Individual EU residents looking for an additional retirement savings vehicle alongside their state and workplace pensions.
• People employed full-time, part-time, or self-employed – the PEPP is also available to people who are unemployed, on parental leave, or in education.
• Mobile professionals who work or expect to work in multiple EU member states across their careers – the PEPP’s cross-border portability is genuinely valuable here.
• Multinational companies looking to offer consistent, harmonised pension benefits to employees across various EU countries.
• Companies employing remote or distributed workers across EU borders.
• Self-employed and gig economy workers in EU countries where local self-employed pension options are limited or expensive.

Key features and advantages of PEPPs

The main features and advantages of the PEPP:

• Cost-capped: total annual costs on the Basic PEPP option are capped at 1% of accumulated capital – one of the strictest cost caps in European pension regulation.
• Transparent: all costs, fees, risks, and projected outcomes are disclosed upfront in the PEPP Key Information Document (KID), with standardised disclosure rules across providers.
• Portable across the EU: you can keep contributing to the same PEPP if you move between EU member states – no need to start over with a new local pension each time you relocate.
• Provider switching: you can switch PEPP providers every five years, with switching costs capped by regulation.
• Lifecycle investment approach: the Basic PEPP option uses a regulated investment strategy that adjusts risk exposure as the saver approaches retirement – reducing exposure to volatile assets over time.
• Tax-efficient (in some jurisdictions): exact tax treatment varies by country, but PEPPs are designed to qualify for the same tax incentives as comparable national pension products where member states have implemented this.
• Strictly regulated: PEPPs are supervised under a harmonised EU regulatory framework with EIOPA oversight, providing investor protections comparable to other EU-regulated retail financial products.

Main disadvantages of a PEPP

The PEPP framework has notable drawbacks to consider:

• Limited provider availability: despite the 2022 regulatory launch, PEPP adoption has been slow – only a handful of providers offer PEPPs across the EU, limiting consumer choice and competitive pressure.
• Uneven tax treatment: tax incentives are determined by each member state, and implementation has been patchy. Some countries provide full tax treatment alignment with local pensions, others provide partial alignment, and several have not yet implemented PEPP-specific tax legislation at all.
• Locked-in until retirement: like most pension products, PEPP funds are generally inaccessible until retirement (or specific qualifying life events) – making it inappropriate for shorter-term savings goals.
• Opportunity cost vs local pension wrappers: in countries with generous tax-advantaged local pension schemes (e.g., German Riester, Portuguese PPR, Polish IKE/IKZE, UK SIPP), local options may offer better tax treatment than PEPPs – so the PEPP often makes most sense after you’ve maximised your local pension allowances first.
• Withholding tax complexity: cross-border investment income within a PEPP may be subject to withholding taxes at source, with recovery depending on the bilateral tax treaty between your country of residence and the investment’s source country.
• Young framework: the PEPP regulation only came into force in March 2022 – meaning operational experience and case law are still developing.

How tax incentives work

This is where the PEPP framework genuinely complicates matters. While the product is designed for pan-European use, each EU member state retains sovereignty over personal income tax – including how pension contributions and withdrawals are taxed. The European Commission and EIOPA have strongly recommended that member states extend the same tax treatment to PEPPs as comparable national pension products, but implementation has varied:

• Member states that have aligned PEPP tax treatment with comparable local pensions (Slovakia is the leading example, given Finax’s role as the primary PEPP provider).
• Member states with partial alignment – some tax incentives apply but not the full local pension treatment.
• Member states with no specific PEPP tax legislation – PEPP contributions and withdrawals may be treated under generic investment rules rather than enjoying pension-specific tax advantages.

This patchy tax framework is widely cited as the single biggest practical limitation of the current PEPP regime. Before opening a PEPP, you should always verify the specific tax treatment in your country of residence – and compare it carefully against the tax-advantaged local pension options available to you. In countries with strong existing pension frameworks (Germany’s Riester/Rürup, Portugal’s PPR, France’s PER, Poland’s IKE/IKZE, etc.), the PEPP may not offer meaningful tax advantages over local alternatives.

EIOPA maintains a public PEPP central register and publishes updates on member state implementation – the most authoritative source for current tax treatment by country.

Is the PEPP safe?

Yes – while the PEPP is a relatively new pension framework, it operates under a comprehensive set of EU-level regulations and supervision. The reason there are still few PEPP providers is partly because of the rigorous regulatory hurdles institutions must clear before they can offer a PEPP – a feature rather than a bug from a consumer protection perspective.

PEPP supervision operates on two levels:

• EIOPA (European Insurance and Occupational Pensions Authority) sets the EU-wide supervisory standards, maintains the PEPP central register, and coordinates cross-border supervisory cooperation between member states.
• National regulators (such as BaFin in Germany, ACPR in France, CMVM/ASF in Portugal, KNF in Poland) supervise PEPP providers operating within their jurisdiction.

If you need to file a complaint about a PEPP provider, you’d typically contact the national regulator in your country of residence first, with EIOPA providing oversight at the EU level. PEPP providers must also be members of relevant national investor compensation schemes, depending on their licence type – giving you the same protection floor as comparable national pension products.

How is the PEPP being applied across EU jurisdictions?

PEPP implementation remains a work in progress across the EU. Member states have been at very different stages of adopting the PEPP framework into their national legislation – particularly around the tax treatment that determines whether the PEPP is genuinely attractive in each country.

Member states that have implemented PEPP-specific regulations include (non-exhaustive list, subject to updates):

• Czech Republic
• Denmark
• Hungary
• Italy
• Luxembourg
• Malta
• The Netherlands
• Slovakia (the most developed PEPP market to date, given Finax’s leadership)

Other EU member states – including Portugal, Spain, France, and Germany – have been progressing PEPP implementation at varying speeds, with some still in drafting or consultation stages. The European Commission continues to push for harmonised tax treatment across member states, but actual progress has been incremental. For the most current implementation status by country, consult the EIOPA PEPP central register directly.

The PEPP and European robo-advisors

The European retail investment market – fragmented across multiple languages, tax frameworks, and financial regulations – has historically been a difficult environment for robo-advisors to scale across borders. To expand from one EU country to another, robo-advisors typically need to develop separate investment strategies that accommodate the local tax framework, regulatory requirements, and currency considerations in each new market.

This fragmentation means European robo-advisors generally can’t achieve the same economies of scale as their US counterparts like Betterment or Wealthfront, which operate across a single large market. The result is often higher fees, smaller product ranges, and slower innovation than US equivalents.

This is why the PEPP is particularly interesting for the European robo-advisor industry: it provides a single regulatory framework that allows a robo-advisor to offer a pension product across all EU member states without needing to navigate dozens of separate national frameworks. In theory, this should help national robo-advisors grow into pan-European players – though as we’ve seen, the patchy tax incentive alignment has so far limited how quickly this expansion has materialised. Finax is the leading example of a national robo-advisor using the PEPP framework for cross-border expansion.

Final thoughts

The PEPP has the structural ingredients to become a meaningful pillar of European retirement saving: harmonised EU-level regulation, cross-border portability, strict cost caps, transparency requirements, and the potential to bring real competitive pressure to a historically fragmented pension industry. However, the framework’s success ultimately depends on each member state’s willingness to align tax treatment with local pension alternatives – and that alignment has been slower and more uneven than the European Commission originally hoped.

For most European retail savers, the practical takeaway is:

• Maximise your local tax-advantaged pension allowances first (Riester/Rürup in Germany, PPR in Portugal, PER in France, IKE/IKZE in Poland, etc.) before considering a PEPP.
• Consider the PEPP if you’re a mobile EU professional likely to live in multiple member states across your career, work in a country where local pension options are limited or expensive, or want low-cost diversified retirement exposure that doesn’t tie you to any single country.
• Verify the specific PEPP tax treatment in your country before committing – particularly whether contributions are tax-deductible and how withdrawals will be taxed.

We’ll continue tracking PEPP developments and updating this article as the framework evolves. For the most authoritative source on PEPP implementation across the EU, visit the EIOPA PEPP central register.