Lisa Picardo, Chief Business Officer UK at PensionBee commented: “We welcome the FCA’s multi-firm review of the pension transfer process, which sets out expectations under the Consumer Duty, and acknowledges and highlights many of the issues PensionBee has been championing on behalf of consumers for many years. Through our ongoing 10-day-switch campaign, we’re calling for faster, electronic transfers to be made standard, alongside a reformed scam-prevention framework that protects savers without slowing legitimate transfers.
“Auto-Enrolment transformed the UK pensions landscape for the better, but an unintended consequence has been the rapid growth of small pension pots. As people move jobs more frequently, they’re left with multiple modest pots scattered across providers. Millions of pension transfers happen each year as consumers seek to consolidate their pensions to simplify management, seek better alternatives and take control of their retirement savings - and this is only set to increase. Making transfers quick, transparent and secure is therefore vital to a healthy pensions market, and essential ahead of the launch of the pensions dashboard.
“Yet pension transfers across the broader landscape in many cases remain unnecessarily slow and complex. They’re now ranked as the second most difficult administrative task after moving house, with 46% of savers describing at least one transfer as ‘difficult’. This friction risks billions in hard-earned savings being lost or left behind, and undermines trust in the pensions system.
If pension transfers take an unreasonably long time, this can harm the consumer - impacting their confidence and hindering their ability to plan for and manage their retirement. Under the FCA’s Consumer Duty, providers are expected to act in good faith, avoid foreseeable harm, and support customers in achieving their financial objectives. Opaque and jargon-filled pension transfers directly undermine these principles.
“To fix this, government and regulators must remove unnecessary barriers stopping consumers from taking control of their financial futures, while the industry modernises its processes and technology. We believe the solution is clear:
1. Introduce 10-day, electronic pension transfers as standard – already proven possible by leading providers.
2. Reform the scam-prevention rules so that important and effective protections remain, but are proportionate and don’t block legitimate transfers.
3. Promote clear, jargon-free communication that empowers savers to make confident decisions.
“Ultimately, consumers rightly expect their pensions to be as accessible and responsive as any other aspect of their financial lives. As the pioneer in the pension consolidation space, PensionBee welcomes any initiative that forces the industry to raise its game on pension transfer times and customer service."
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