Specialist financial services software and consultancy provider Altus has partnered with the Pension and Lifetime Savings Association (PLSA) and pension data expert ITM to author an exclusive report reviewing the complex challenges that small pots pose to the financial services industry.
The number of small pots has continued to grow and in 2020, the PPI have projected that, without policy change, the number of deferred pots could grow from 8m to 27m by 2035.
The report focuses on the challenges of data matching, and the risks and costs associated with transferring small pots. It concludes that the industry can learn from elements already in place as a steppingstone to support small pots.
Altus Business Systems Director Ben Cocks commented: “The industry has been facing the problems posed by small pots for many years. As the industry has been rejoicing at the obvious success of auto-enrolment, the challenge is growing, and it needs to be addressed quickly.
The industry has done a lot of work to streamline the pension transfer process and make it more efficient for both members and providers. It can now extend the standards already in place to tackle the small pots challenge.”
The whitepaper can be accessed here.