Pension master trusts join forces to tackle outdated transfer systems

Eight pension master trusts have joined forces in a bid to improve the pension transfer system following uproar over its outdated and sluggish practices.

The group, dubbed Pathfinder, brings together trusts including Nest, Smart Pension and People’s Pension, which represent over £162.7bn in funds under management and 14.5m savers.

It aims to examine the current state of pension transfer infrastructure and how it can be effectively modernised to meet customer needs, with trusts also looking to review efficient transfer activity and discuss where change is needed to ensure a swifter process.

Gavin Perera-Betts, chief customer officer at Nest, said: “Members’ pension savings are one of their most significant financial assets, so we want to ensure improvements to the transfer process focus not only on improving efficiency but on helping members to make the right choices, as well as protecting them from fraud and unauthorised access.”

Sluggish and sludgy

Pathfinder’s creation comes at a pivotal time for UK pensions, with both the industry and the government scrambling to reform the system, encourage greater saving, and identify sluggish providers to tackle the looming retirement crisis. 

Some UK pension providers and administrators are taking eighteen times longer to transfer retirement savings than their counterparts, leaving some savers waiting months for their money to be moved.

Some of the most sluggish took between 47 and 90 days, in comparison to just five for the fastest providers, according to analysis by Pension Bee.

While the average industry transfer time remained broadly unchanged at 23 days in 2025, delays at the bottom end accelerated.

Others have called out sludge practices, which are deliberate or excessive frictions, such as requiring signatures in paper forms, in attempts to delay clients transferring money.

The practices create a fractured market, shutting out pension savers who do not have access to digital platforms, such as self-employed people and those without workplace schemes, from faster transfer times.

Surge in transfers

Pathfinder also comes at a time when transfer activity is set to increase sharply off the back of the arrival of the pension dashboard, an online portal where savers can log in and see all pensions they have accumulated over their careers.

The launch is estimated to cause the consolidation of over 13m ‘small pots’ worth £1,000 or less.

Pathfinder is also looking to double-check data, such as names and addresses, at the beginning of the transfer process rather than the end, in a bid to prevent rejections late in the process, which leads to savers dropping out and failing to engage.

Angela Staral, chief operating officer at People’s Pension, said: “It is important to recognise that transferring a pension is fundamentally different from switching bank accounts, as the decisions made can have long-term implications for retirement outcomes. 

“That said, once savers have made an informed choice, the process itself should be as simple and efficient as possible.”