Unnecessary complexity, excessive paperwork, and discouragement from existing providers are deterring savers from transferring their pensions, research from Penny Pensions has found.

The survey, which gathered views from users who had successfully transferred at least one pension but failed to complete subsequent transfers, revealed a "clear picture", suggesting that ceding schemes could be creating friction for savers, even after they have indicated a desire to consolidate their retirement savings.

In particular, Penny found that nearly half of users said the process was too complicated or time-consuming, while many reported never receiving the required forms from their existing provider.

In addition to this, others said they were burdened with confusing paperwork or even actively discouraged from transferring.

There was also a significant emotional element, according to Penny, with more than 65 per cent of respondents stating that they felt frustrated, confused, or unfairly treated during the transfer process.

Penny suggested that these experiences also reflect a broader "crisis" of trust in the pensions industry, with recent findings from Trafalgar House's fifth Trust & Confidence Index revealing that public trust in pensions has fallen to 5.23 out of 10, from 5.26 in 2024.

And Penny head of pensions, David Henderson, argued that these are not isolated incidents, stressing the need for simplified, standardised pension transfer processes.

The company also warned that, without meaningful reform, tools like pensions dashboards risk being undermined by back-end blockers and poor user experience.

"This confirms what we've long suspected — many providers are making it unnecessarily hard to transfer pensions, even when customers have already taken the first step," he stated.

“The irony is clear. When people finally engage with their pensions — often after years of delay — the system pushes them away. It’s time to stop putting up barriers and start putting customers first.”

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