Defined benefit transfer activity fell to a record low in February, data from XPS has found.

XPS Group’s Transfer Activity Index fell to the lowest observed rate since the Index was established in 2018.

In February 2025, there was an annualised rate of 13 members in every 1,000 transferring their benefits to alternative arrangements.

This was the third consecutive month the index had fallen, suggesting that members are becoming increasingly cautious when making decisions about their retirement arrangements.

Helen Cavanagh, senior consultant at XPS Group, said: “The continued decline in transfer activity highlights a notable shift in member behaviour and could point towards a new norm within the transfer landscape.”

However, XPS Group’s Transfer Value Index remained relatively stable over February 2025, ending the month only slightly lower than at the end of January, at £146,000.

This is in line with the previous lowest month-end value recorded in December 2024.

XPS said this was in part driven by a slight decrease in long-term inflation expectations.

Elsewhere, XPS reported that 92 per cent of cases reviewed by the Scam Protection Service in February 2025 raised at least one scam warning flag.

This is the highest level seen since June 2024 and marks a significant increase of 4 per cent compared to the prior month.

Cavanagh added: “Although we have observed a jump in the scam flag index this month, the average Index over the past 12 months is lower than the peak we observed in mid-2022 following the introduction of the transfer regulations in late 2021.”

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