New process for DC to DC transfers proposed
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The Financial Conduct Authority is consulting on giving pension providers greater leeway to offer online modellers and creating a new process for non-advised transfers between defined contribution schemes. The consultation is open until 12 February 2026.
The regulator argued that the launch of pensions dashboards will increase consumer awareness of their pensions and the potential for consolidation. “So, we propose to introduce a new step in the non-advised transfer process.”
This follows a discussion paper published a year ago on the regulatory framework for projections produced in digital tools and modellers, the process for DC to DC pension transfers and consolidation, and the regulatory framework for SIPPs.
When savers choose to consolidate some or all of their DC pots, they may unwittingly give up beneficial elements such as protected benefits. The FCA's proposals would put an onus on the receiving scheme to seek information from the ceding schemes and on ceding schemes to respond within 10 working days.
The information will need to be presented to the pension saver before the transfer goes ahead, including if any valuable benefits would be lost, and how ceding and receiving schemes compare.
The aim is to help people be better informed and engaged, as well as identifying where they might need advice or guidance.
The FCA aims to review the feedback and publish final rules on this in the second half of 2026.
The regulator argued that the launch of pensions dashboards will increase consumer awareness of their pensions and the potential for consolidation. “So, we propose to introduce a new step in the non-advised transfer process.”
This follows a discussion paper published a year ago on the regulatory framework for projections produced in digital tools and modellers, the process for DC to DC pension transfers and consolidation, and the regulatory framework for SIPPs.
When savers choose to consolidate some or all of their DC pots, they may unwittingly give up beneficial elements such as protected benefits. The FCA's proposals would put an onus on the receiving scheme to seek information from the ceding schemes and on ceding schemes to respond within 10 working days.
The information will need to be presented to the pension saver before the transfer goes ahead, including if any valuable benefits would be lost, and how ceding and receiving schemes compare.
The aim is to help people be better informed and engaged, as well as identifying where they might need advice or guidance.
The FCA aims to review the feedback and publish final rules on this in the second half of 2026.
Provider has its eye on DC trusts
Lisa Picardo, chief business officer UK at platform PensionBee, welcomed the proposed changes but said they should also apply to trust-based schemes, saying the industry is "plagued" by slow transfer times.
“For years, companies like PensionBee have been forced to request thousands of documents from ceding providers, often facing lengthy delays or no response at all, and have been pushing for change to better serve consumer interests. The FCA’s proposals to enforce a consistent 10 working day response time and to mandate the acceptance of digital signatures are long-overdue steps that help modernise the industry and ensure customers no longer suffer from outdated, paper-based processes," she said.
“However, to ensure this reform really delivers on its promise, it’s essential that TPR-regulated providers are brought into scope, given they account for approximately 30m DC pension memberships and could otherwise be a major source of inconsistency and delay," she said.
Picardo wants to see changes to the ‘Amber and Red Flag’ system designed to prevent scams, claiming this is "in practice being persistently misused by some to delay transfers", adding that "it’s positive and welcome news that the DWP expects to consult on revisions in 2026, as this has the potential to clean up some of the industry’s ‘sludge’".
