Provider Smart Pension will take on Corpad Master Trust, which has more than 20,000 active members.
After a strategic review, the company decided to focus on its core business as a third-party administrator, and chose the workplace pension provider to take on its £20m of assets under management.
Smart Pension, which is part-owned by Legal & General, has some 700,000 members.
Andrew Evans, chief executive and co-founder of Smart Pension, said the transfer demonstrated that Smart’s technology-powered master trust offered a "good quality home for master trusts large and small that are looking for a frictionless, uncomplicated solution, that’s extremely user-friendly and that guarantees to sync smoothly with payroll cycles in every instance".
He added: "We will be working closely with Corpad over the coming months."
Trevor Best, managing director at Corpad, noted that the company was "particularly impressed" with Smart’s technology, its experience in this field, and governance, which was a big part in its decision-making process when looking for a new provider.
He added: "This move will allow us to focus on our core business."
The deal followed the announcement earlier this year that Smart Pension was taking over Corporate Pensions Trust, sponsored by national financial advisory group Lighthouse, and was in talks with other providers looking to consolidate.
The master trust market has seen increased consolidation after new rules were introduced by The Pensions Regulator last year.
From October 1, 2018 master trusts had until March 31, 2019 to apply to the TPR for authorisation to demonstrate that they have met required standards.
Under the new registration process, master trusts 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.
The government and the regulator have been discussing these new rules since 2016.
Smart Pension has applied for authorisation in April and is awaiting feedback from TPR.
maria.espadinha@ft.com
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