TransaveUK Launch Opt-Out Payroll Savings Trial

Thursday 25 January 2024

A new innovative partnership to test the effectiveness of an opt-out approach to workplace emergency saving has been launched by Nest Insight in collaboration with TransaveUK, SUEZ recycling and recovery UK.

This trial, believed to be one of the first of its kind, will examine whether making payroll saving the default enables many more workers who want to build up a savings buffer to get started. Nest Insight’s opt-out payroll savings programme has been made possible by the support of the BlackRock Foundation and the Money and Pensions Service (MaPS).

Over the next six months, new joiners to SUEZ, a leading recycling and waste management company, will be automatically signed up to payroll saving with credit union Transave, if they don’t opt out. Drawing upon early findings from Nest Insight’s sidecar savings trial, it’s believed that the automatic nature of this approach will reduce barriers to saving by reducing sign-up friction and overcoming inertia – people’s tendency to do nothing when faced with a decision. This change, similar to the approach used for pensions auto enrolment, preserves employees’ choice to decide what to do with their money, whilst removing the need for them to complete a full sign-up journey if they want to start saving. Instead, there’s only one decision to make: whether to opt out. Employees will be able to make changes to the amount they save if they want to, quickly withdraw their money if they need it and they can stop saving at any time.

Guy Opperman, Minister for Pensions and Financial Inclusion said: “Employers have a vital role in helping their staff build greater financial resilience. Schemes offered by employers, such as payroll savings, can help people build a safety net that enables them to withstand short-term financial shocks. Workplace emergency savings schemes take up is too low and I look forward to reviewing the findings of this trial.”

Roger Shelton, Marketing and Business Development Manager at Transave, added: “Saving regularly is the single most important thing that a person can do to improve their financial wellbeing so any initiative which promotes payroll savings is to be encouraged. We hope other leading employers will take note of this important trial and consider the advantages of an opt-out savings model for their own employees going forward”.

Jo Phillips, Director of Research and Innovation at Nest Insight, comments:  “Nest Insight and the academic team are grateful to SUEZ and Transave for their time and dedication to setting up this ground-breaking trial with us, to the BlackRock Foundation and MaPS for their generous support, and to the FCA regulatory sandbox for working with us to explore how to enable this trial under the current regulations. We look forward to sharing results as the trial progresses.”