Pensionbee, a fintech pension provider, has complained to traditional life company Aegon about its slow transfer processes.
The newer kid on the block has claimed its older rival is employing systems which are directly targeting it, and making life more difficult for Pensionbee customers.
Both companies are members of Origo Options - a service which facilitates pension transfers - but since June, Aegon has refused to transfer to Pensionbee using the service.
Pensionbee, which is regulated by the Financial Conduct Authority and registered with HM Revenue & Customs, has attempted to clarify why Aegon has taken this stance, but a spokesperson said it has not been given an explanation.
Aegon has countered that it has treated all transfers from Pensionbee in line with its due diligence processes.
However Pensionbeen claims illogical inconsistencies in Aegon's processes - and delays in carrying out pension transfers of up to seven months.
For example, one Pensionbee client was able to transfer one pension electronically but the other had to be done by completing a series of paper forms.
Clare Reilly, head of corporate development at Pensionbee, said: “We are concerned that Aegon is preventing customers from switching efficiently and has arbitrarily changed its transfer processes despite already making hundreds of electronic transfers, totalling millions of pounds, to PensionBee.
“We are increasingly troubled by Aegon's treatment of customers and urge Aegon to rectify the situation as soon as possible to prevent any further consumer detriment from occurring.
“We have attempted to resolve this issue with Aegon via every means available to us.
“Their refusal to offer any specific reason for blocking electronic transfers or engage in any meaningful discussion on the matter is extremely frustrating for our customers, many of whom have now been trying for months to leave Aegon.”
Several Pensionbee customers have now complained to Aegon over the length of time it has taken to transfer between the two companies.
In a bid to address Aegon's sudden decision to stop using Origo Options for transfers to Pensionbee, the fintech pension provider's chairman, Mark Wood, a former UK chief executive of Prudential, has written to Adrian Grace, the chief executive of rival Aegon.
But the issue has not been resolved, with Mr Wood claiming Mr Grace refused to discuss the matter with him.
Pensionbee was founded in 2014, offers online pension plans and has had more than 38,000 sign-ups since it was launched.
A number of Aegon clients attempting to transfer to Pensionbee have been sent letters suggesting they consider whether they are transferring into a scam along with a leaflet from The Pensions Regulator on how to avoid scams.
The letter stated this is part of Aegon’s “standard due diligence checking process” and gives the client 21 days to decide whether to proceed or not.
Earlier this year Aegon told FTAdviser that in 2016 it had stopped £3.04m from going into scams through pension transfers.
This figure is based on transfers that were declined because of either a scam risk or a transfer request that has been withdrawn by the customer following Aegon's intervention.
An Aegon spokesman said: “We have spent a great deal of time investing in systems to ensure that customers are able to transfer their pensions safely and efficiently either to another provider or to us.
“In all respects, requests from PensionBee to transfer customer funds to their pension plans are treated in line with Aegon’s standard due diligence processes which are in place to protect customers and to meet our legal and regulatory obligations.”
Steven Robinson, managing director of Clarke Robinson, said: "I have never heard of one provider refusing to transfer to another through Origo before. I sounds like it might be a due diligence issue.
"I have not had any issues with Aegon at all. The last Aegon transfer I did was a couple of weeks ago. It didn't have any problems and it went through Origo."
damian.fantato@ft.com
