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STAR transfers initiative covers in excess of 35 million customers

Press Release

STAR transfers initiative covers in excess of 35 million customers

2 April 2019

Summary:

  • 21 firms, covering in excess of 35 million pensions, investments and policies, have already pledged to work within
    the STAR framework
  • Growing community of firms signing up to industry framework
  • Next stage of development will bring in technical working groups and a supplier forum – first Steering Group
    scheduled for May
  • FCA is now firmly focussed on transfers and re-registration as an issue


A growing community of firms have signed up to the STAR initiative. STAR is tasked with delivering an industry standard for the transfer and reregistration of consumer’s money and investments from one financial company to another. This will significantly improve the transfer performance of the industry.

To date 21 companies, including some of the key industry players, have pledged to work within the STAR framework, covering the savings and investments of 35 million pensions.

With reports of transfers regularly taking several months to complete, yet banking being subject to a 7-day switching guarantee, it should be no surprise that the FCA has taken a keen interest in resolving the issue for consumers.

The STAR framework was highlighted in the FCA’s Investment Platforms Market Study final report published in March, where the FCA made it clear it expects the industry to resolve the transfers issue or it would face “further regulatory action”. The FCA said it was encouraging firms to consider participating in STAR “as a way of improving the switching process and achieving better outcomes for consumers.”

With the wide-ranging and extensive industry support, the next stage of STAR’s development will bring in technical working groups and a supplier forum, with the first Steering Group meeting scheduled for May.

“This is about the industry doing things better for their customers but there is a commercial benefit too: In the transfer market we all have to deal with counterparties. It doesn’t matter how slick your own systems are, if the firm you’re dealing with isn’t willing to work quickly then you’ll still end up wasting time and money dealing with manual queries and you’ll have an unhappy customer. Customers still sometimes have to wait for a pension schemes to write out a cheque and post it to complete a transfer. This one step in the process can add a week to a transfer. As a business, if you want to put a stop to this kind of arcane practice, you should sign up to STAR and encourage all other firms to do the same. Hargreaves Lansdown’s own experience shows the benefit of firms collaborating: 75% of our SIPP transfers are completed in 11 days when executed electronically, but postal transfers take an average of 68 days to complete. There are even cases of transfers taking over 450 days.”

Tom McPhail, Hargreaves Lansdown and Founding Chair of the STAR Steering Group

Regulatory reporting
The STAR framework was developed in consultation with the DWP, TPR and FCA (through TRIG, the industry working group). As part of the ongoing operation of STAR, Management Information detailing which firms have joined and how they are performing will be regularly submitted to the regulators. This means firms which don’t join or persistently fail to
improve will be identified.

STAR is establishing technical forums to agree the processes for the collection and reporting of MI and a forum also is being establishing for service providers such as transfer and re-registration businesses. This will facilitate consultation, process improvement and consistency of standards on an ongoing basis.

In addition, the first 30 firms that sign to STAR will be awarded a Founder Accreditation Mark, a highly visible endorsement of adoption of the STAR framework and its objectives to improve end-to-end transfers.

“There is now both a moral imperative from the consumer outcome perspective and a regulatory imperative for firms to willingly address the transfer issue and with the FCA pointing in this direction the best way for the industry to show its commitment to improving its game is to join STAR and benefit from becoming part of the solution.”

Tom McPhail, Hargreaves Lansdown and Founding Chair of the STAR Steering Group

Notes

For further information please contact:

Matthew Dransfield
Commercial and Marketing Director
Criterion
0773 765 0010
media@criterion.org.uk

About STAR

STAR was created as a collaboration between Criterion and TeX, combining the industry-reach, unique strengths, experience and shared ambition of the two not-for-profit organisations.

Criterion was formed for the industry in July 2017, as an independent, not-for-profit industry body providing Standards and Governance services. It was originally part of Origo Services Ltd and has been publishing process and integration standards for over 25 years. Criterion is uniquely positioned to facilitate and drive cross-industry engagement, helping
organisations achieve higher levels of collaboration, reduce costs and achieve better outcomes for their consumers.

TeX is a not-for-profit organisation which works with the industry to ensure that the maximum benefit is provided to all members. This new company is financially independent from TISA but benefits from being linked to the TISA brand through name, the expertise provided by the two corporate entity directorships and the administrative support provided by
TISA.

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© 2024 CT Holdings and Services Limited (CTHS), a joint venture between TISA Exchange Limited and Criterion Tec Limited.

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SERVICING AGREEMENT

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1. APPLICANT COVERED BY THIS REGISTRATION.
Please note this registration will not be processed if Step 1 has not been completed.
If your organisation is acting only as an affiliate, you do not need to complete Step 2.
2a. CHOOSE YOUR BRAND
STAR manages the administration of third-party access to the portal, rather than the member firm. This allows for a smoother transition for the member firm and allowing immediate access to the supplier to submit MI on their behalf. STAR will hold an approved list of users per supplier, which will be allocated to your account at the point of registration. This ensures each ‘external’ user has the same access across all their client accounts. Supplier access is restricted and they do not have any ability to see any company information for any client other than what they submit on your behalf. You as the member control access for any other users within your organisation. We will include a more detailed description about the user access on your welcome email and it is clearly defined as part of the User Guide.
STAR RELATIONSHIP MANAGER FOR FIRST BRAND
This person will be the main contact for all notices and other formal communications under this agreement and will be responsible for the administration of the members portal access (including without limitation the providing, updating and removing of authorised User access to the portal during the Term).
2b.
STAR RELATIONSHIP MANAGER FOR THE SECOND BRAND
This person will be the main contact for all notices and other formal communications under this agreement and will be responsible for the administration of the members portal access (including without limitation the providing, updating and removing of authorised User access to the portal during the Term).
2c.
STAR RELATIONSHIP MANAGER FOR THE THIRD BRAND
This person will be the main contact for all notices and other formal communications under this agreement and will be responsible for the administration of the members portal access (including without limitation the providing, updating and removing of authorised User access to the portal during the Term).
2d.
STAR RELATIONSHIP MANAGER FOR THE FOURTH BRAND
This person will be the main contact for all notices and other formal communications under this agreement and will be responsible for the administration of the members portal access (including without limitation the providing, updating and removing of authorised User access to the portal during the Term).
3. INVOICE INFORMATION
Invoices are sent by email as standard, if a printed invoice is required please note the address and your requirements in the additional information section.
4. DECLARATION
Before we can process your Brand Registration a STAR Servicing Agreement needs to be signed. Your signatory must be duly authorised for and on behalf of the organisation named in this application.
We only require one signed STAR Servicing Agreement which will cover all brands that you wish to register. Upon completion of this form we will check our records to ensure an agreement hasn't already been signed, if so a new contract will not be sent to your signatory.
STAR will email the servicing contract to the signatory email address (provided below) through our electronic platform Yoti. This declaration must be signed in order for your application to complete, once we receive the signed agreement we will instruct our finance department to issue your invoice.

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