This compares to 41% of transfers showing red flags in December.

The most prevalent warning flag seen in January was a lack of member understanding regarding fees paid to the receiving scheme, according to XPS Pension Group’s Transfer Watch.

The Transfer Activity Index fell by a further 6% in January, setting another record low since XPS started tracking activity in 2018.

An annualized rate of 47 members out of every 10,000 transferred their pensions in January.

XPS said the fall is likely to have been driven in part by difficulties that members continue to face in accessing quality financial advice.

The Transfer Value Index also fell again in January to a month-end average of £253,000. This represents a 2% drop from the end of December, despite rises in inflation expectations.

XPS said the fall in transfer values was largely due to a continued increase in gilt yields over the course of January.

Mark Barlow, head of member options at XPS Pensions Group, said: “Transfer activity remains at historically low levels, a sign that members continue to struggle to find suitable financial advice. It’s imperative that schemes do all they can to help members access quality advice before they make any decisions about what to do with their pension pots.”

XPS Transfer Watch monitors how market developments have affected transfer values for an example member, as well as how many members are choosing to take a transfer value.

XPS Pensions Group’s Transfer Value Index shows the estimated cash transfer value of a 64-year-old member with a pension of £10,000 a year with typical inflation increases. The value changes over time with market movements. Mortality assumptions are reviewed periodically.

XPS Pensions Group’s Transfer Activity Index, represent the annualised proportion of members that transfer out of pension schemes administered by XPS. If replicated across all private sector, funded, UK, DB schemes this indicates that approximately 50,000 DB members leave their schemes each year

XPS Pensions Group’s Scam Flag Index tracks the percentage of monthly transfers reviewed by the businesses’ scam protection service that are identified as having warning ‘flags’ which indicate that the member is at risk of being scammed. The flags monitored include both the DWP’s set list of amber and red warnings and further areas of concern identified and monitored by XPS’ Scam Protection Service.