KiwiSaver monthly transfers hit an annual high during September spiking to 1.5-times the growth in new members, the latest Inland Revenue Department (IRD) statistics show.
According to the IRD figures, over 15,000 KiwiSaver members swapped schemes in September, up almost 2,000 on the previous month and about 7,000 more than the 12-month low reported last December.
The IRD numbers exclude bulk KiwiSaver transfers due to scheme mergers.
Overall KiwiSaver membership grew by 9,399 over September – about on par with the previous 12 months – to total more than 2.67 million.
The Financial Markets Authority (FMA) has previously expressed concern at the high rate of KiwiSaver transfers introducing tighter rules in 2013 aimed at dampening high-pressure transfer practices.
“We found a high level of transfers between schemes and noted most providers didn’t record the type of service provided in transfer situations,” the FMA 2016 KiwiSaver annual report says.
However, earlier this month the FMA released new proposals freeing up more KiwiSaver transfer advice to fall under the less onerous ‘class advice’ disclosure rules.
Liam Mason, FMA director of regulation, said at the time: “We hope our new guidance will encourage providers to now go ahead and support their customers to get the help they need.”
The FMA proposals are open for comment until December 16.
Meanwhile, the IRD stats show all of the net KiwiSaver membership growth during September occurred in the age 25-plus cohort. The number KiwiSaver members aged under 18 fell almost 1,700 during the month while the 18-25 group dropped about 150.
Since the government removed the $1,000 ‘kickstart’ incentive last May the number of KiwiSaver members aged under 18 has steadily declined: over the 12 months to end of September this year, the cohort has dropped almost 15,000, according to the most recent tally of 347,521.
KiwiSaver withdrawals under the first home provisions also remained steady during September with more than 2,400 members taking out almost $50 million.