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The central bank of the Philippines is scheduled to launch a digital retirement and investment plan on September 8. The retirement account was launched three years ago, and the digital launch is part of the bank’s efforts to digitize the financial system.
In a press release, the Bangko Sentral ng Pilipinas (BSP) revealed that the launch will be spearheaded by central bank governor Benjamin Diokno. It will be streamed live through the bank’s Facebook page.
The Personal Equity and Retirement Account (PERA) is a voluntary account that allows any Filipino 18 years of age or older to prepare for their eventual retirement. Launched in December 2016 by the BSP, it does not depend on salary deductions, unlike existing products. Rather, it allows citizens to invest voluntarily, with an annual limit of 100,000 pesos ($ 2,061). For foreign workers, the annual limit doubles to $ 4,120.
By launching PERA, the BSP aimed to encourage Filipinos to invest in long-term retirement savings products.
With the digital launch, the regulator seeks to make it even more convenient for citizens to invest in their future.
Governor Diokno commented: “Digital PERA will allow Filipinos to invest in PERA investment products anytime, anywhere using only their mobile phones and other devices. This is firmly in line with the BSP’s goal of fostering digitization in the financial system and bringing the BSP closer to people. “
The BSP has been pushing to digitize payments in the Southeast Asian nation for the past few years. Despite the fact that 60% of the country’s population uses smartphones, the economy is still heavily dependent on cash transactions.
However, in the last five years, digital payments have seen a sharp and steady increase. Having accounted for just 1% of all payments in 2013, digital platforms now account for 20% of retail payments in the country. The COVID-19 pandemic has shed light on the importance of digital payments.
This trend could get a big boost if the BSP’s CBDC efforts show positive results. As CoinGeek reported, the BSP recently commissioned a task force to explore the viability of a CBDC. The working group is expected to present its findings in September 2020.
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