The Bangko Sentral ng Pilipinas (BSP) has updated its regulations to expand investment options for Personal Equity and Retirement Account (PERA) funds.

The new rule exempts PERA Unit Investment Trust Funds (UITFs) from the 10% non-resident ownership limit that previously restricted their ability to invest in BSP securities.

This move is significant for overseas Filipinos, who are a major component of PERA contributors.

Previously, the BSP generally prohibited non-residents from owning its securities (debt instruments that the central bank issues). The BSP only allowed UITFs to invest in these securities if non-resident participation in the fund remained below the 10% cap.

According to the BSP, this limit was a major barrier.

Currently, nine out of the 13 available PERA-UITFs exceed the 10 per cent non-resident ownership limit, which barred them from diversifying their portfolios with BSP securities. The regulatory change now allows them to access these investments.

UITFs are pooled funds managed by banks and regulated by the BSP, allowing individuals to access diversified portfolios.

The BSP stated the move aims to help Filipinos build secure retirement savings and strengthen the country’s private pension system.

Based on central bank data, voluntary retirement contributions grew by 24% to PHP 491.39 million in 2024. As of December 2024, there were 5,912 PERA contributors.

This figure included 789 overseas Filipino workers who contributed PHP 82.25 million, 4,211 employed people, and 912 self-employed individuals.

Featured image by EyeEm via Freepik.