BOCI-Prudential: little room left for MPF fee cuts; rebates for big accounts instead

BOCI-Prudential chief executive Thomas Chan Yu-cheong believes there is limited room for further MPF management-fee cuts, and the firm will instead offer rebates or perks to higher-asset clients. He also warned that the government’s plan to raise the lower income threshold for contributions would reduce protection for low earners.

Why is there little room for cuts?

The industry already cut earlier this year. Chan’s line matches his earlier rebate announcement: after a round of cuts in the first half, broad-based fee reductions in the second half look unlikely. But one of his fund plans does rebate 0.1 percentage point a year on management fees for clients with net assets of HK$250,000 or more — fee relief, but only for the well-heeled.

What does raising the lower threshold mean?

Low earners could end up less protected. Chan noted that lifting the lower income limit means workers earning below the new floor won’t have to contribute — saving money today, but ending up with smaller retirement pots tomorrow.

To compare management fees and rebate perks across plans, visit MPF fund comparison.