Defined benefit (DB) transfer values have fallen to an “unprecedented low” amid recent market volatility, falling to £181,000 at the end of September, according to XPS Pension Group’s Transfer Value Index.

This represents a £16,000 or 8 per cent fall in transfer values, with transfer values having now fallen by almost a third this year as a result.

According to the index, transfer values fell as low as £150,000 on 27 September, following the mini-Budget announcements and subsequent market reaction, which saw gilt yields briefly reach 5 per cent per annum, triggering market interventions from the Bank of England.

Scam concerns have also persisted, as the number of transfer cases raising at least one scam warning flag rose slightly over the month to equal the previously recorded high of 97 per cent.

This was according to XPS’s Scam Flag Index, which covered close to 400 transfers in September, with the majority of these members referred to MoneyHelper for a safeguarding call.

The number of savers transferring their pension has remained steady, however, as the index showed an annualised rate of 38 members per 100,000 were transferring pensions to another provider for the second consecutive month, continuing the trend of lower volumes of transfers being paid in 2022.

Commenting on the figures, XPS Pensions Group head of member options, Mark Barlow, stated: “Whilst the focus on pension funds in recent weeks has been largely on gilt rates and their impact on scheme investments, DB promises remain largely unaffected.

“However, pension scheme members considering a transfer will be impacted as values fall to their lowest level for almost 20 years.

"On the other hand, those using their transfer to secure benefits in alternative arrangements, for example annuities, will see marked improvements which may offset some or all of the fall”

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