The Pooled Employer Plan (PEP) market is reshaping the delivery of retirement benefits in 2026. What began as an SECURE Act innovation is now one of the fastest-growing segments in the US retirement plan market, creating a significant growth opportunity for 401(k) recordkeepers.
For recordkeepers facing margin pressure, increasing competition, and slower growth in the large-plan market, PEPs offer a scalable path to acquiring new business, expanding assets under administration, and serving the rapidly growing micro- and small-employer segment.
This article explains why PEPs are gaining momentum, the opportunities they create for recordkeepers, and the strategic capabilities recordkeepers need to capitalize on this growth wave.
The PEP market has reached escape velocity.
PEPs enable unrelated employers to participate in a single retirement plan managed by a Pooled Plan Provider (PPP), reducing fiduciary and administrative burdens for employers while delivering economies of scale.
According to Cerulli Associates, PEP assets grew from nearly $12 billion in 2023 to approximately $21 billion by the end of 2024, representing one of the strongest growth trajectories in the retirement industry. During the same period, the number of PEPs expanded from 109 in 2021 to 339 in 2024, while more than 50,000 employers adopted the structure. Participant balances also increased 49% year-over-year between 2023 and 2024.
Cerulli research in 2025 also found that 71% of recordkeepers view PEPs as a major or moderate strategic priority, while 63% expect PEP growth to impact their business positively. It shows leading recordkeepers increasingly view PEPs as a core growth strategy rather than a niche offering.
4 ways recordkeepers can capitalize on the PEP opportunity
1. Win the micro and small employer market
Many recordkeepers still struggle with the cost and complexity of sponsoring standalone retirement plans. PEPs address these barriers by pooling administration, fiduciary oversight, compliance, and investment management.
For recordkeepers, this creates access to thousands of employers that were previously uneconomical to serve individually. Instead of adding plans one at a time, recordkeepers can scale participant growth more efficiently with a single PEP structure.
2. Build strategic partnerships with PPPs and TPAs
The PEP ecosystem depends on collaboration between recordkeepers, pooled plan providers (PPPs), advisors, and third-party administrators (TPAs). Industry leaders are increasingly adopting partnership-driven models to accelerate growth and improve service delivery.
Recordkeepers that establish strong PPP and TPA relationships will be better positioned to participate in future PEP expansion.
3. Differentiate through Technology and Participant Experience
As PEP adoption increases, technology becomes a key differentiator. Recordkeepers must support streamlined employer onboarding, real-time payroll integration, automated compliance monitoring, participant self-service capabilities, and personalized retirement experiences.
Recordkeepers that deliver frictionless digital experiences will be better positioned to attract PPPs, advisors, and employers.
4. Prepare for increasing regulatory complexity
The retirement industry continues to evolve under the implementation requirements of SECURE 2.0. Automatic enrollment provisions, Roth catch-up contribution requirements for certain high-income participants, and other regulatory changes are increasing operational complexity for recordkeepers.
PEPs can simplify many employer responsibilities, but recordkeepers still need robust compliance infrastructure, reporting capabilities, and operational controls to support growth at scale.
The real differentiator: Operational readiness at scale
While the growth potential of PEPs is clear, success is not determined solely by market participation. As more employers join pooled arrangements, operational readiness is becoming the defining factor that separates market leaders from the rest.
The challenge lies in the structure of PEPs themselves. Unlike traditional single-employer plans, a single PEP may encompass dozens or even hundreds of unrelated employers, each operating different payroll systems, HR platforms, contribution schedules, and participant data formats.
Recordkeepers must accurately and efficiently aggregate, validate, and reconcile this information while maintaining compliance across all participating employers. Recent SECURE 2.0 provisions have further increased the complexity. Requirements related to automatic enrollment, long-term part-time employee eligibility, and Roth catch-up contributions have introduced new administrative and compliance obligations that many legacy recordkeeping systems were not designed to support at scale.
At the same time, onboarding expectations continue to rise. As Pooled Plan Providers expand their offerings and employer adoption accelerates, recordkeepers are under pressure to onboard participating employers quickly without sacrificing accuracy or service quality. Manual processes that may have worked in traditional plan environments can quickly become bottlenecks in a rapidly growing PEP ecosystem.
Scaling PEP growth requires the right technology
To compete effectively in the evolving PEP market, recordkeepers need scalable technology infrastructure, automated workflows, seamless payroll integration, robust compliance controls, and real-time data management capabilities.
With deep expertise in retirement plan technology solutions and retirement plan administration services, Congruent Solutions helps 401(k) recordkeepers modernize their platforms, automate complex workflows, improve compliance readiness, and scale administration efficiently.
Congruent’s CORE suite of solutions is a modular cloud-based record-keeping platform that helps you address the challenges of contribution data collection. With CORE Census, CORE Eligibility & Enrollment, and CORE Contributions, you can automate the entire process. Our solutions are built to:
- Ability to create, maintain and manage multiple MEP and PEP products on the platform
- Accept multiple file types and formats
- Calculate eligibility and automate enrollment
- Run over 100 different data and business validations
- Generate custom reports for Administrators, Sponsors
- Provide a self-service platform to all users
- Work with your existing platforms
CORE PlanSuite directly addresses the onboarding bottleneck that throttles PEP growth for recordkeepers. With AI-guided workflows, automated plan document interpretation, and automated validation, CORE accelerates plan onboarding and conversions, enabling recordkeepers to rapidly scale their PEP roster without a proportional increase in headcount.
CORE Eligibility and CORE Payroll automate the complex, multi-employer eligibility calculations mandated by SECURE 2.0, including LTPT employee tracking, automatic enrollment, and auto-escalation, ensuring compliance accuracy at scale without manual intervention.
For consolidated Form 5500 filing and compliance testing, Congruent Solutions provides expert operational outsourcing that PPPs and recordkeepers can rely on to maintain fiduciary accuracy across their entire PEP book of business.
From cloud-based retirement technology solutions and participant-facing digital experiences to retirement plan administration services, recordkeeping support, compliance operations, and system modernization initiatives, Congruent enables recordkeepers to meet the demands of the rapidly expanding PEP market by providing the technology solutions and retirement plan domain expertise needed to make that growth a reality.
Discover how Congruent Solutions empowers 401(k) recordkeepers with the retirement technology and administration services needed to scale PEP growth efficiently.
Frequently asked questions
Key questions on the Pooled Employer Plan (PEP) growth opportunity, operational readiness, SECURE 2.0 compliance, and how 401(k) recordkeepers can scale efficiently in 2026.
A PEP allows unrelated employers to join a single retirement plan managed by a Pooled Plan Provider (PPP), reducing fiduciary and administrative burdens while delivering economies of scale. Introduced under the SECURE Act, PEPs have become one of the fastest-growing retirement market segments. According to Cerulli Associates, PEP assets grew from approximately $12 billion in 2023 to $21 billion by end of 2024, the number of PEPs expanded from 109 in 2021 to 339 in 2024, and more than 50,000 employers have adopted the structure.
Cerulli research in 2025 found that 71% of recordkeepers view PEPs as a major or moderate strategic priority, while 63% expect PEP growth to positively impact their business. For recordkeepers facing margin pressure, increased competition, and slower growth in the large-plan market, PEPs offer a scalable path to new business acquisition, expanded assets under administration, and efficient entry into the rapidly growing micro- and small-employer segment.
Many small and micro employers have historically been uneconomical to serve individually due to the cost and complexity of standalone plan sponsorship. PEPs address this by pooling administration, fiduciary oversight, compliance, and investment management into a single structure. For recordkeepers, this unlocks access to thousands of previously unreachable employers — allowing participant growth to scale more efficiently without adding plans one at a time.
The PEP ecosystem depends on close collaboration between recordkeepers, Pooled Plan Providers (PPPs), advisors, and third-party administrators (TPAs). Industry leaders are increasingly adopting partnership-driven models to accelerate growth and improve service delivery. Recordkeepers that establish strong PPP and TPA relationships early will be better positioned to participate in future PEP expansion as the market consolidates.
As PEP adoption increases, technology becomes the primary competitive differentiator. Recordkeepers must support streamlined employer onboarding, real-time payroll integration, automated compliance monitoring, participant self-service capabilities, and personalized retirement experiences. Recordkeepers that deliver frictionless digital experiences are better positioned to attract PPPs, advisors, and employers to their platforms over less capable competitors.
A single PEP may encompass dozens or hundreds of unrelated employers, each with different payroll systems, HR platforms, contribution schedules, and participant data formats. Recordkeepers must accurately aggregate, validate, and reconcile this information while maintaining compliance across all participating employers simultaneously. SECURE 2.0 provisions — including automatic enrollment, LTPT eligibility, and Roth catch-up requirements — further compound what many legacy systems were not designed to handle at PEP scale.
SECURE 2.0 has introduced compliance obligations that multiply across every employer in a PEP: mandatory automatic enrollment, long-term part-time (LTPT) employee eligibility tracking, and Roth catch-up contribution requirements for certain high-income participants. These requirements must be accurately applied at scale — creating significant strain for recordkeepers relying on legacy systems or manual compliance workflows that were never designed for multi-employer environments.
As PPPs expand their offerings and employer adoption accelerates, recordkeepers face growing pressure to onboard participating employers quickly without sacrificing accuracy or service quality. Manual processes that may have worked in traditional plan environments become bottlenecks in a fast-growing PEP ecosystem. The ability to onboard at speed and scale — without a proportional increase in headcount — is now a defining competitive capability for recordkeepers.
Congruent’s CORE suite is a modular, cloud-based recordkeeping platform purpose-built for PEP and MEP administration. Capabilities include: creating and managing multiple MEP and PEP products on a single platform; accepting multiple file types and formats from diverse payroll systems; automated eligibility calculation and enrollment; over 100 data and business validations; custom reporting for administrators and sponsors; a self-service platform for all users; and seamless integration with existing platforms. CORE PlanSuite further accelerates plan onboarding using AI-guided workflows and automated plan document interpretation.
CORE Eligibility and CORE Payroll automate the complex, multi-employer eligibility calculations mandated by SECURE 2.0 — including LTPT employee tracking, automatic enrollment, and auto-escalation — ensuring compliance accuracy across all employers within a PEP without manual intervention. This enables recordkeepers to grow their PEP book of business confidently while maintaining fiduciary accuracy at scale.
Congruent Solutions provides expert operational outsourcing for consolidated Form 5500 filing and compliance testing that PPPs and recordkeepers can rely on to maintain fiduciary accuracy across their entire PEP book of business. This allows recordkeepers to scale PEP operations efficiently without building large internal compliance teams or accepting elevated regulatory risk as their book of business grows.
