Only one of 55 workplace schemes in line for master trust authorisation has applied to be authorised since the window was opened two months ago.
According to an update published by The Pensions Regulator (TPR) in December, 54 more master trust schemes are expected to either apply for authorisation or trigger their exit from the market in the coming months.
From the 90 master trusts identified in the market at November 30, three schemes have exited so far.
A further 32 have notified the watchdog of a triggering event to exit the market and will transfer their members to an alternative master trust scheme or other appropriate vehicle.
Master trusts have until the end of March 2019 to apply for authorisation with the regulator.
Under the new registration process, master trusts will have to hold enough capital to cover the cost of a worst-case scenario, such as the cost of transferring to another scheme or of winding up, without charging members.
Most providers are working on drafting their applications to the new regime, such as Evolve Pensions, responsible for five master trusts, including the Bluesky Pension Scheme.
Paul Bannister, chief executive of Evolve Pensions, said at the Westminster Business Forum conference yesterday (December 11) that the provider would be filing its application with the regulator this week.
He said master trust authorisation was key and the topic was being discussed more than Brexit at the provider’s office at the moment.
In its update, TPR stated authorisation would "increase the quality of master trust products and providers, and therefore increase protection for members".
For those master trusts that choose to exit the market, or fail to get authorised, the regulator will oversee the process to satisfy itself that "members are transferred in a safe and timely manner and employers continue to meet their auto-enrolment duties – taking enforcement action if necessary.
"We have already supported the 35 schemes that have exited, or plan to exit the market," the watchdog concluded.