Data from over 3,950 pension transfers in the 2022/23 financial year has found on average, consumers must wait almost one month (29 days) for ceding companies to transfer their pension funds to a new provider.
Customers with some pension providers could wait for anything between 120 days on average (XPS Administration) down to 18 days (Prudential), depending on which firm their pensions pots were with
My Pension Expert’s 2023 Retirement Fairness Index has uncovered the lengthy delays retirement planners in the UK face waiting for pension pots to be transferred between providers.
The independent retirement advisor analysed data from 3,953 pension transfers that it managed on behalf of clients during the 2022/23 financial year. Measured from the date an application was submitted to a pension provider to when My Pension Expert received confirmation that the fund had been transferred, the analysis revealed that, on average, it took 29 days for ceding companies to move the money.
Delays from ceding companies – pension scheme members’ existing providers – transferring money to an alternative provider can be stressful and financially detrimental for consumers. Some will miss out on better returns as they wait for funds to move between providers, while others are reliant on their pension as their only source of income, so having it tied up in a pending transfer can leave them financially exposed.
Prudential (an average of 18 days per transfer), Clerical Medical (22 days), Reassure (22 days), Sun Life Financial of Canada (23 days), Standard Life (23 days) and Scottish Widows (24 days) were the quickest of the ceding companies when it came to transferring their customers’ funds to a new provider in the last financial year.
XPS Administration (120 days), DHL Pension Department (65 days), Willis Towers Watson (62 days), Nest (60 days), The People’s Pension (59 days) and Scottish Friendly (58 days) were the ceding companies that took the longest average time to transfer funds, according to My Pension Expert’s data.
My Pension Expert is committed to working with the Government and industry bodies to drive a higher level of transparency within the sector and, wherever possible, shortening ceding delays.
Lily Megson, Policy Director at My Pension Expert, said: “Our data, spanning almost 4,000 pension transfers, clearly demonstrates that retirement planners in the UK are having to wait far too long for their hard-earned savings and investments to be transferred from ceding companies to a new provider. It is a significant issue and one that the Government and pension sector must work together to address.
“The process is too often slow and opaque, leaving the customer wondering where their funds are and why providers are taking so much time to transfer them across. While we must accept that this cannot happen instantaneously – security checks and due diligence is required – we must fight against what has become an accepted notion in the industry that pension transfers can take weeks if not months to be completed. It is not good enough and undermines people’s trust in the pensions sector.
“Transparency is key. Retirement planners need to be able to see how much money they have in their pension pots, how those pots are performing, and, when transferring between providers, exactly how this process is proceeding. My Pension Expert is committed to tackling this issue, providing greater speed and transparency for pension customers across the country.”
