BDO Unibank (BDO) said it recently accepted its first batch of Personal Equity and Retirement Account (PERA) contributors via a test launch.
In a statement on Thursday, BDO said it is the first of only two banks in the country to be authorized by the Bangko Sentral ng Pilipinas (BSP) and the Bureau of Internal Revenue (BIR) to act as PERA Administrators.
RA 9505 or PERA Act of 2008 promotes capital market development and savings mobilization by establishing a legal and regulatory framework of retirement plans for persons, comprised of voluntary personal savings and investments.
“The State recognizes the potential contribution of PERA to long-term fiscal sustainability through the, provision of long-term financing and reduction of social pension benefits,” the law said.
The Sy-led bank said PERA was offered to a limited number of clients at its head office branch in Makati City. The clients were briefed on PERA prior to opening their PERA accounts.
BDO said that in line with PERA requirements, the briefing was conducted by PERA accredited personnel who explained its features, terms and conditions as well as which PERA products are available and suitable for each particular contributor.
PERA was created by Republic Act 9505 which was signed into law on August 22, 2008. PERA establishes the legal and regulatory framework for voluntary personal retirement plans as a means to promote savings mobilization and capital market development.
Ultimately, it is meant to provide Filipinos a way to supplement their future pension benefits from either the Social Security System or the Government Service Insurance System.
Since its enactment into law, various Implementing Rules and Regulations have been issued by regulators.
BDO said PERA is very much in line with its advocacy for financial inclusion.
“Launching PERA has been a challenge given the coordination required from the different PERA Participants, namely the Cash and Securities Custodian and the various Product Providers. However, we are glad that the recently issued PERA rules and regulations have finally enabled BDO to do this launch. The next step is to enable PERA to be offered on a wider scale,” said Ador Abrogena, trust officer and executive vice president of BDO Trust and Investments Group.
As an industry, he said banks need to continue working on the documentation and onboarding processes to make them more efficient and cost effective.
“We are likewise hopeful that the rules will be refined over time to allow millions of Filipinos to benefit from lower transaction and management costs for PERA and make it more inclusive,” he said.