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Transfer times and why they matter

Some KiwiSaver providers are taking longer than they ought to carry out a requested transfer to another scheme.

Thursday, December 5th 2019, 8:30AM 3 Comments

by Michael Lang


Speed and a lack of friction costs are essential for an efficient market. Since its inception in 2010 (two years after KiwiSaver was launched) the number of members in the NZ Funds KiwiSaver Scheme has grown year on year for nine years.

As our scheme has never sought default status and never acquired another scheme, the growth has been entirely organic. New members have primarily joined by switching from other providers. 

In total, NZ Funds has attracted 6,880 members and lost 1,520 members – small in comparison to default funds – but big enough to gather information on over 1,000 switches to the NZ Funds KiwiSaver Scheme in the last 30 months.

After scrubbing this data for errors, outliers and PIE tax rebates, we discovered the KiwiSaver industry can be divided into two types of managers: efficient operators, and those who appear to be gaming the system.


Despite being criticised by the FMA in 2014 for poor sales practices, when it comes to assisting members who have chosen to transfer to another provider, Australian owned banks Westpac, BNZ, ANZ and ASB completed their transfers in less than 10 days on average. 

Similarly, AMP and Mercer took less than 10 days to action members’ switch requests from their schemes to the NZ Funds KiwiSaver Scheme.

But the industry leader, by our numbers, was Milford with a sharp turnaround of just seven days for its members. A bouquet should also go to the New Zealand Defence Force KiwiSaver Scheme. They managed to implement the transfer of the one client that came across to the NZ Funds KiwiSaver Scheme within six days.

For the record, NZ Funds currently takes an average of 12 working days when transferring members out of its scheme, which is something we could improve on. The average for the industry as a whole is 11 days.


And then there are those which needed or chose to take 20 days or more to complete the same process, like SuperLife which ranked last in actioning transfers to the NZ Funds KiwiSaver Scheme by taking an average of 26 days to switch members who had asked to transfer. They were joined by Generate which took 25 days, and Booster which took 24 days.

Excluding SuperEasy, a restricted KiwiSaver scheme for local council employees, there are no other managers who take on average 20 or more days.

The different treatment of transfer requests from default schemes and non-default schemes also makes for interesting reading. 

Under the existing rules, default schemes are required to process transfers within 10 days, while non-default scheme providers can take up to 35 days. It is interesting to observe that Booster, which has both default and non-default schemes, appears to be able to comply with the 10 day requirement for transfers from its default scheme, but is not able to do so for transfers from its non-default scheme. 

Who benefits, who loses and what are the rules? The benefit of delaying a transfer are clear. This aspect of KiwiSaver is now widely recognised as being poorly conceived.

As part of the amended Scheme Provider Agreements, all schemes will be required to transfer within 10 working days from April 1, 2020. This is a positive move, but it is a pity that some schemes did not self-regulate themselves to ensure they were acting in all members (including exiting members) best interests. 


Michael Lang is Chief Executive at NZ Funds and his comments are of a general nature. New Zealand Funds Management Limited is the issuer of the NZ Funds KiwiSaver Scheme. A copy of the latest Product Disclosure Statement for the scheme is available on request and at

Michael Lang is Chief Executive at NZ Funds. New Zealand Funds Management is the issuer of the NZ Funds KiwiSaver Scheme.

Tags: KiwiSaver NZ Funds

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Comments from our readers

On 5 December 2019 at 3:12 pm Hugh Stevens said:
Thanks for pointing this out Michael. We'll have a look and make changes to speed up our process - although it's likely all providers will move to 10 day transfer times under changes being proposed by IRD.

Ironically, SuperLife KiwiSaver charges lower fees than almost all the providers listed as having quick transfer times - so the members being encouraged to transfer will most likely be paying higher fees (which research shows means lower performance).

Regards, Hugh
On 5 December 2019 at 7:59 pm Michael.Lang said:
Thanks for commenting Hugh. Good points.
On 5 December 2019 at 9:32 pm Gordon Gecko said:
What would add value to this analysis is understanding how many transfers each scheme had to NZ Funds as some smaller schemes may not have a statistically significant sample size where a slight delay in 1 or 2 transfers skews the average. This would distort the data.

Given all the managers are within the mandated timeframe I'm not sure this is actually "news".

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