Lloyds Bank is offering customers up to £5,000 in cash in what it says is its first-ever pension transfer cashback offer.
The eye-catching incentive is the latest sign of the fierce battle being fought for Britain’s retirement wealth, with banks and investment firms increasingly targeting savers sitting on large pension pots. Under the deal, customers who transfer old pensions worth at least £20,000 into a Lloyds Ready-Made Pension or Self-Invested Personal Pension (SIPP) can qualify for cashback payments ranging from £250 to £5,000. However, the maximum payout is only available to customers transferring £2million or more, while those moving between £20,000 and £49,999 will receive £250.
The offer runs from June 1 until November 30 and is open to new and existing Lloyds pension customers. To qualify, savers must also hold or open a current account with Lloyds, Halifax or Bank of Scotland and keep it open until the cashback is paid. The transferred pension savings must remain invested until May 31, 2027, with cashback due to be paid by June 30 next year.
The move is designed to encourage customers to consolidate old pension pots built up during their working lives. Many people accumulate several workplace pensions as they move jobs, making it harder to keep track of their retirement savings and the charges they are paying.
But pension experts regularly warn savers to think carefully before transferring retirement funds, as some older schemes may contain valuable guarantees, protected benefits or lower charges that could be lost.
Pensions are also subject to investment risk and the value of investments can fall as well as rise.
Manuel Pardavila-Gonzalez, managing director of investments at Lloyds, said: “It is common for people to build up several pension pots over the course of their careers, which can make it harder to keep track of savings or understand the charges they are paying.
“Our personal pension aims to make it easier to bring those pots together in one place, giving customers a clearer view of their retirement savings.
“Bringing pensions together can also help them take a more active role in managing their money, making it simpler and easier to plan for retirement, with our cashback incentive making the process even more rewarding.”
Customers transferring between £50,000 and £99,999 can receive £500, rising to £1,000 for transfers worth between £100,000 and £249,999.
The cashback increases to £1,500 for transfers of £250,000 to £499,999 and £3,000 for those worth between £500,000 and £999,999.
Anyone transferring between £1million and £1.99million can receive £4,000, while those moving £2million or more qualify for the maximum £5,000 payment.