ELTIFs in Germany's New Pension Savings Account: What the 2027 Launch Means for the Market
From January 2027, ELTIFs are eligible for Germany's individually configured Altersvorsorgedepot. Why the cost cap isn't the real issue – and where the hurdles actually lie.
Germany's new state-subsidised retirement savings vehicle, the Altersvorsorgedepot (AVD), launches on 1 January 2027, replacing the long-standing Riester pension as the country's primary incentivised private savings product. For the ELTIF market, the implications are significant: alongside UCITS funds, the AVD also permits open-ended retail AIFs and ELTIFs – but only in the individually configured version, not in the standard product. What that means in practice, and where the real friction points are, is now coming into sharper focus.
A Market Already in Motion
The AVD launch coincides with a period of sharp expansion across the ELTIF segment. In 2025 alone, 113 new ELTIFs came to market – nearly twice the number launched in 2024 – with 56 asset managers entering the space for the first time. Assets under management rose by €12 billion year-on-year, reaching €34.0 billion by end-2025, a 55% increase. These figures are drawn from the Scope Fund Analysis 2026 study ‘Massenstart geglückt’ (‘Mass launch succeeded’), published in March 2026. From January to end-July 2026, a further 49 ELTIFs launched across Europe, bringing the total number of active products to 315, according to Scope's August 2026 market update.
The legislative framework is settled. The German parliament passed the pension reform act on 27 March 2026, with the Bundesrat approving it on 8 May 2026. The key structural detail for ELTIFs is the split into two variants: the standard AVD is limited to UCITS assets such as ETFs and mutual funds. Only the individually configured AVD opens access to Private Market investments, provided the fund carries a summary risk indicator (SRI) of no more than 5 in its key information document.
Scope considers annual inflows of €30–50 billion into the new system plausible over the medium to long term. Assuming a Private Market allocation of 5–10%, that implies annual ELTIF potential of €1.5–5 billion. For comparison, German investors held €4.4 billion in ELTIFs at end-2025.
The Cost Question: No Cap, but a Direct Comparison
The standard AVD carries a statutory cap of 1% annual effective costs. That cap is irrelevant for ELTIFs, since they are not permitted in the standard product. The individually configured AVD has no statutory cost ceiling.
Costs nonetheless remain the central bottleneck – through transparency. Providers must disclose effective costs in the product information sheet using the PRIIPs total cost methodology, which places an ELTIF on the same form as a broadly diversified ETF. According to Scope, management fees for evergreen ELTIFs average between 1.7% (cheapest share class) and 2.5% (most expensive share class). Across funds listed on myELTIF, the median management fee is 2.00%.
There is also a methodological problem: ex-ante calculation. Many ELTIFs charge a performance fee that must be estimated in advance for cost disclosure, usually based on historical data. Most ELTIFs, however, only launched in 2024 or 2025 and have little track record. Transaction costs on direct investments and costs at the underlying-fund level can likewise only be estimated. The disclosed effective cost figure for an ELTIF is therefore considerably more model-dependent than for an ETF. Scope expects asset managers to launch product variants and fee structures tailored specifically to the pension market.
Risk Classification: Not a Bottleneck Today, but a Risk Over Time
Most products already meet the risk threshold: of 53 evergreen ELTIFs analysed by Scope, 46 (87%) carry an SRI of 5 or lower. The open question is what happens if an ELTIF's SRI rises above 5 during the holding period. Illiquid Private Market assets cannot be sold at short notice, so a forced rebalancing would be difficult to execute in practice. In addition, the volatility-based PRIIPs methodology is under criticism for illiquid assets, including before the ECJ, because smoothed NAV valuations can understate actual volatility. A change in methodology could shift how Private Market funds are classified.
Of the 69 funds currently listed on myELTIF nearly all products with a known investor classification are accessible to both retail and professional investors. The median minimum investment is €10,000. How such entry thresholds will be handled within a savings-plan-based pension account remains open.
What Comes Next
Scope's analysis concludes that the AVD could deliver a significant demand boost for ELTIFs – conditional on the industry making progress on costs and risk transparency. The AVD has the potential to create, for the first time, a structural distribution channel for Private Market assets within subsidised retirement savings. At the January 2027 launch, however, the offering is likely to be thin: Scope expects broad rollout of ELTIF offerings in the individually configured AVD mainly in the second half of 2027.
This article is for informational purposes only and does not constitute investment advice. All myELTIF platform statistics are based on aggregated data and are not comprehensively verified by the respective asset managers. Past market data is not a reliable indicator of future developments.