The proportion of pension transfer cases that raised at least one scam warning flag rose to 92 per cent in June 2024, the highest level since September 2023, XPS Group has revealed.

XPS Group’s Scam Flag Index showed the proportion of cases with a scam flag rose from 89 per cent in May 2024 to 92 per cent in June.

While the index had remained “relatively stable” over the past quarter, June marked the first month this year to exceed 90 per cent of cases raising at least one scam warning flag.

XPS Group’s Transfer Activity Index observed a marginal decrease in June, falling from an annualised rate of 19 members in every 1,000 transferring their benefits to alternative arrangements in May to 15 members in every 1,000.

This was the seventh consecutive month that the index had remained below 20 members per 1,000 transferring their benefits, compared to just a single occurrence in 2023.

The second quarter of 2024 saw the lowest volume of transfers since the index was first published, XPS Group noted.

Meanwhile, XPS Group’s Transfer Value Index “held steady” in June at £156,000, the sixth consecutive month that it has been at or below £160,000.

XPS Group stated that the index had shown “remarkable stability” in 2024, with the largest change in the past six months being a decrease of 3.4 per cent from March to April.

The second quarter of this year was the most stable in three years, which was attributed to lower volatility in gilt yields and long-term inflationary expectations.

"We have seen yet another quarter of the Transfer Value Index remaining stable, although average transfer values are about 5 per cent lower when compared with the same period last year,” commented XPS Group senior consultant, Helen Cavanagh.

“This decline in transfer values may be contributing to the historically low transfer volumes, with the Transfer Activity Index being lower than ever before over 2024.

“With the new government in place, we hope to see increased engagement from them on the transfer regulation changes that were discussed with the industry prior to the general election, which could potentially lead to falls in the Scam Flag Index in future.”

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