A joint venture between TeX and Criterion is to manage a new industry-wide transfer framework with the aim of delivering investment and pension transfers within two weeks.
Known as ‘Star’ the JV is the result of a recommendation from the Transfers and Re-registration Industry Group (Trig). which comprises representatives from 10 major financial services trade bodies.
TeX and Criterion are both spin-off organisations from established financial services companies. TeX, an industry contract club set up by the Tax Incentivised Savings Association (Tisa), manages and runs non-commercial contracts between parties that cover standards, service level agreements and matters of liability concerning transfers. Criterion is a technology standards body that demerged from Origo last year.
Benefits for all
The framework should see participating firms enabling transfers within two weeks for most contracts and three weeks for occupational pension transfers. For transfers involving multiple transactions and counterparties, each step should take just two days.
Star will collect and publish information on the participating firms’ transfer performance.
Trig said the framework should see consumers benefit from better communication, common standards, continuous improvement and greater transparency on firms’ performance, while firms should benefit from consistent and improving standards, leading to higher certainty and lower operating costs.
Hargreaves Lansdown’s Tom McPhail, chair of Trig, said: “The publication of a register of financial companies who have signed up to this initiative and of ongoing performance data will bring transparency and scrutiny to companies’ performance, creating pressure on businesses that are lagging behind to up their game.
“We have been very impressed with the capabilities and commitment the TeX and Criterion teams have brought together in creating the Star joint venture. Trig is therefore very happy to endorse this governance solution and to recommend it to industry members and other stakeholders.”
Commitment urged
Guy Opperman, under-secretary of state for pensions and financial inclusion, said: “I welcome this initiative and the progress made so far in speeding up transfers. For routine defined contribution transfers it makes sense, from both a competition and customer service point of view, that members are able to move their money swiftly.
“For many members moving money is straightforward but for some others it’s far from effective and I’d urge firms to commit to the Trig framework, as this is an area the government is keeping a close eye on.”
Caroline Mansley, Criterion managing director, added: “We believe that what is required is sufficient participation to provide a broad and deep pool of subject matter expertise, to develop the first version of the transfer process definitions.”
The 10 trade bodies making up Trig are: the Association of British Insurers, the Association of Member-Directed Pension Schemes, the Investment Association, the Pensions Administration Standards Association, the Pensions and Lifetime Savings Association, the Personal Investment Management and Financial Advice Association, the Society of Pension Professionals, Tisa, UK Finance and the UK Platform Group.
