The eMPF digital platform would help the administration fee rate further decline to as low as 0.2 percent in a decade, as the platform has been in operation for nearly one year, according to the Mandatory Provident Fund Schemes Authority.
Since its launch on June 26 last year, the fee charged by eMPF has been set to 0.37 percent, which is 36 percent lower than the 0.58 percent average charged by trustees before joining the digital platform, MPFA chairman Ayesha Macpherson Lau posted in her blog on Sunday.
Lau estimates that fee rates could be further reduced gradually to somewhere between 0.2 and 0.25 percent over a 10-year period.
The eMPF was expected to slash the administration fees currently charged by fund trustees by 41 to 55 percent, equivalent to a cumulative cost savings of HK$30 billion to HK$40 billion.
Lau said the eMPF operates on a non-profit basis and that trustees are required to charge an administration fee not higher than the fee they pay to the eMPF Platform Company – the digital platform's operator – benefiting the city’s pension fund contributors.
Proposed in 2017, the eMPF platform is designed to digitalize the management and enhance the administrative efficiency of the pension fund system, which involves 11 million accounts and nearly HK$13 trillion worth of assets contributed by over 4.79 million workers.
The data transfer entered phase two in March, with the aim of having the accounts of four medium-sized trustees migrate to the eMPF platform by August 1. Upon the completion of the second phase, the eMPF would cover more than 2.7 million accounts and about 70,000 employer accounts, Lau said.
The coming third phase, involving the four largest MPF trustees, is very challenging, she said, adding that the eMPF project team is continually enhancing the platform in a bid to improve user experience.
STAFF REPORTER
