CONTRIBUTORS of the Personal Equity Retirement Account (PERA) have continued to rise as more were able to enjoy the convenience of its digitization.
“Since the launch of digital PERA in September 2020 until end-February 2022, the number of PERA contributors has grown from 1,684 to 4,379, or almost three times,” Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said at an online briefing on Thursday.
“Digital PERA has significantly reduced processing time and transaction cost,” he added.
However, this is still far from the five million PERA contributors the BSP targets to have by 2025, which represents 10% of working Filipinos locally and abroad.
“In any case, we recognize the current challenges that may prolong the achievement of our goal. We will reassess the targets after consultations with industry, partner agencies and other stakeholders,” the BSP chief said.
Mr. Diokno said 71% of contributors are employees, while the rest are overseas Filipino workers (OFWs).
He said total PERA contributions as of February reached P265.5 million, nearly double the P140.8-million level in September 2020.
Broken down, 68% of the contributions were from employees, 19% were from OFWs, and 13% were invested by self-employed individuals.
“We expect the growth to continue as the economy recovers from the pandemic,” Mr. Diokno said.
The BSP chief said there are 12 PERA unit investment trust funds (UITFs) that are suitable to contributors with different risk profiles. These include three money market funds, six bond funds, and three equity funds.
Five more UITFs have been accredited by the BSP and the Bureau of Internal Revenue which are expected to be launched soon for PERA contributors, Mr. Diokno added.
PERA is a voluntary retirement fund scheme opened to Filipinos through Republic Act 9505. It was meant to supplement the retirement benefits from the Social Security System, Government Service Insurance System, and private employers.
Contributors can inject maximum annual investments worth P100,000, while overseas Filipinos are allowed to pour in up to P200,000 a year in their PERA accounts.
PERA contributors benefit from perks like exemptions from final withholding, capital gains and regular income taxes. They are also entitled to a 5% tax credit on contributions for the year, which can be used to pay or lower annual income tax due. — L.W.T. Noble