Hargreaves Lansdown is doubling down on workplace pensions, signing a big technology alliance with the fast-expanding Smart Group that could lead to it pushing deeper into the auto-enrolled pensions sector.

Hargreaves said it was partnering with Smart’s Keystone technology division to boost the versatility and scaleability of its workplace pensions operation, which runs staff pension schemes for more than 520 employers with over 200,000 employees.

Hargreaves, which is the UK’s biggest platform for retail investors, said the technology improvements would enable it to offer other investment products like savings accounts, non-pension investment accounts and Isas to the workplace clients.

It is one of the most significant strategic announcements made by the new chief executive Richard Flint since Hargreaves was taken over by the private equity firm CVC and Abu Dhabi’s sovereign wealth fund in a £5.4 billion deal that completed in March.

There had been speculation that Hargreaves could sell the workplace division, which is seen as subscale with only £9 billion of assets under management. The government has made plain it aims to push for a consolidation of the sector so that all players run assets of £25 billion or more by 2030. It wants to see scale benefits passed on to pension savers.

Hargreaves said the deal “signifies enthusiasm and commitment to growing the workplace distribution channel”. It would spend “multi millions of pounds” on the tech upgrade.

The technology upgrade is seen as either a prelude to a push deeper into workplace pensions or a way of making the division more attractive to a third-party consolidator.

The Keystone technology powers Smart Pension, one of the UK’s biggest master trusts, which serves two million savers and 100,000 employers and is the product of more than ten consolidation deals with other master trusts.

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The wider Smart group was founded in 2014 and is owned by a number of investors including JP Morgan, Barclays, Legal & General and Fidelity International.

Flint said, “We are excited to announce this technology partnership with Keystone, which will transform the client experience in our workplace offering. This is part of our renewed ambition and investment in HL Workplace and we look forward to sharing further details in the months ahead.”

Clients of the workplace division include several City names including Jupiter Fund Management, Shawbrook, Man Group and the lawyers Reed Smith. Their employees save via vehicles known as group Sipps.

Hargreaves is scrambling to improve its customer experience after seeing fresh competition from rivals like AJ Bell and Aberdeen-owned Interactive Investor. It has more than two million customers with assets of £173 billion, pulling in a net 136,000 new clients in the year to June. It has hired Doug Abbott from Vanguard as chief product officer, who from March will take charge of its suite of financial products as well as the workplace offering.