Comparable Fees Can Strengthen Retirement Saving in the Philippines

A retirement account asks a worker to make a decision today whose result may become clear decades later. The tax incentive is easy to advertise. The cost of using the account can be harder to compare, especially when charges depend on the product and services selected. As the Philippines broadens its retirement saving options, comparable prices should become part of the effort to build trust.

The Personal Equity and Retirement Account, or Pera, is a voluntary program that supplements other retirement benefits. In August 2026, the Bangko Sentral ng Pilipinas (BSP) issued guidelines for banks offering Pera time deposits. Banks must meet prudential requirements, obtain Bureau of Internal Revenue accreditation, and have an arrangement with accredited Pera administrators before accepting placements. Product eligibility therefore does not mean every bank already offers the product.

The new guidelines also require disclosure of interest rates, effective annual yield, fees, relevant risks, and the conditions attached to tax incentives and withdrawals. That is a useful foundation. The next practical challenge is to make those disclosures easy to compare across the account and its investments, including charges collected by different parties.

The BSP’s explanation of Pera distinguishes administration fees from custody and investment management charges. A custody fee applies to a third-party custody arrangement. An investment management fee applies when a contributor appoints an investment manager. A comparison that automatically adds every fee to every account would be misleading. The relevant price is the cost of the arrangement the saver actually chooses.

Providers could present that price on a short, standardized statement before the account is opened. It should identify each applicable charge, who receives it, whether it is a fixed amount or a percentage, and when it is deducted. If a cost is included inside an investment product, the statement should explain whether the quoted return already reflects it. This would help prevent a saver from overlooking a charge or counting the same one twice.

Fixed fees deserve particular attention. A charge of the same peso amount takes a larger share of a small balance than a large one. That arithmetic matters for someone beginning with modest contributions or adding money irregularly. A standard statement should therefore show what the applicable fees would cost at several illustrative account sizes. Those illustrations should use the provider’s actual schedule and clearly stated assumptions, without presenting an assumed investment return as a promise.

Cost is only one part of the comparison. Two investments with different risks and withdrawal conditions cannot be judged by fees alone. A lower fee does not make a volatile investment suitable for everyone, and a familiar bank product does not remove every long-term saving constraint. The statement should place price alongside risk and access to funds, allowing the saver to understand what is being purchased.

The time deposit guidelines offer a particularly important example: maturity of a deposit does not, by itself, constitute withdrawal from Pera. Savers should be able to distinguish the end of an investment’s term from the ability to take money out of the retirement account. A simple timeline could explain where the proceeds go and which rules govern access. Clear communication at that point can prevent a familiar product name from creating an unfamiliar surprise.

Employers and administrators could make these comparisons available when presenting retirement saving options. Regulators could assess the format with prospective users, including people opening their first investment account.

Better disclosure will not supply income to households that cannot afford to save. It can, however, improve the choices available to those who can contribute and make competition between providers more intelligible. Expansion should give savers more useful options, accompanied by a price they can understand before committing their money. For someone weighing a first contribution, knowing the cost of keeping the account is part of knowing whether to begin.

Gustavo Pessoa,
[email protected]

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