MANILA — The Bangko Sentral ng Pilipinas said the maximum allowable annual contribution to the Personal Equity and Retirement Account (PERA) was doubled to encourage more Filipinos to save for their retirement.
The annual limit for contribution was raised to P200,000 from P100,000 for locally employed and to P400,000 from P200,000 for overseas Filipinos, the central bank said in a statement.
“The increase in the limits provides our kababayans with greater opportunities to ensure their financial security. It also supports the government’s broader thrusts of mobilizing individual savings for capital market development and generating funds for long-term projects," BSP Gov. Felipe Medalla said.
The increase is effective immediately in 2023 as approved by Finance Secretary Benjamin Diokno in line with the PERA Act of 2008 and as recommended by the PERA Inter-agency board.
Aside from increasing the contribution limit, the BSP also removed the basic security deposit for the faithful performance of PERA administrator's duties, previously at 0.5 percent of the book value of PERA assets.
This is expected to lower the cost of administering PERA assets, which may impact contributors through lower charges, it said. This will also encourage financial institutions to participate in the PERA ecosystem, it added.
PERA, launched in 2016, is a voluntary retirement savings program that supplements state-based pension and employer-sponsored retirement plans.
The BSP said PERA contributions have grown by over 30 percent in 2022.
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