“Especially if there’s a risk that any predatory operators could be driving it.”<\/p><\/blockquote>\n
The SMC represents the country’s biggest profit-to-member super funds. The data was based on de-identified member switching data from the five largest member funds, as well as data from the ATO and financial industry regulator APRA.<\/p>\n
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Misha Schubert is calling for stronger consumer protections and safety obligations. (Supplied: Super Members Council)<\/p>\n
It follows the corporate regulator issuing a warning about lead generation services<\/a>, which cold-call people to suggest they shift their superannuation to less regulated funds.<\/p>\n The SMC research found that younger Australians with lower super balances now dominate those switching as opposed to wealthier pre-retirees, with around half of all members switching last year under the age of 45.<\/p>\n In 2024\u20132025, around 70 per cent of Australians who switched out of the five large funds into platform-based funds had under $100,000 in their super accounts, and 80 per cent had under $200,000.<\/p>\n The data showed a similar pattern in switching to SMSFs, with more than half having under $100,000 in their super accounts and three-in-four having less than $200,000.<\/p>\n Why are people switching?<\/p>\n While all super funds are regulated in some way, industry experts are concerned with how oversight differs, depending on the product.<\/p>\n Super consumer advocate Xavier O’Halloran told ABC News that risks were higher and protections were lower for platform products compared to other funds.<\/p>\n “SMSFs in particular have significantly higher risks and lower protections,”<\/p><\/blockquote>\n he said. Xavier O’Halloran says some customers are moving to products with less oversight.\u00a0 (ABC News: John Gunn)<\/p>\n Last week, the Australian Securities and Investments Commission (ASIC) announced a review of financial advice licensees using lead generation services<\/a>.<\/p>\n “Many of the products on a platform are also not performance-tested by APRA, which means you don’t know if they are performing well, and there is little pressure on the super fund to remove them from sale on their platform,” said Mr O’Halloran, the boss of Super Consumers Australia.<\/p>\n However, he noted that one of the main reasons people have been leaving large funds is because of “appalling customer service” seen by some of the major players.<\/p>\n “It is not surprising that AustralianSuper, Cbus Super and HESTA have all experienced people leaving the fund in the last year,” he said.<\/p>\n “All three have been subject to regulatory action for failing to deliver basic customer service to their members, people are voting with their feet.”<\/p><\/blockquote>\n Last year, ASIC announced a review into how some of Australia’s major super funds communicated with members about retirement.<\/a><\/p>\n ASIC will review how super funds communicate with members about retirement. (ABC New: Alistair Kroie)<\/p>\n In the 2025 financial year, $78 billion moved in and out of accounts as 3 per cent of members’ assets switched between regulated funds, according to data from the Conexus Institute.<\/p>\n Conexus estimated $40 billion of that switching involved a financial adviser.<\/p>\n “These competitive flows tend to be directed into funds designed to service financial advisers, most notably platforms,” it stated in a report.<\/p>\n “These numbers increased on FY2024, when we estimated adviser-led switching at $35 billion or 47 per cent of all switching.”<\/p>\n Calls for tighter regulation of industry<\/p>\n Mr O’Halloran said the other major reason people have been switching away from mainstream funds comes down to “inappropriate financial advice” that has moved Australians “out of decent super funds into much riskier options”.<\/p>\n “These switches are often expensive, setting people back over $10,000, charge higher ongoing fees and may see people end up in very risky investment options.”<\/p>\n![\"A](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/02\/0f1b61cb60a90fb19e2e16178333e416.jpeg\")
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