MPF market outlook: consolidation and choice under fee pressure

In 2011 the MPF market stood at a crossroads: the Employee Choice Arrangement was pending, and fee pressure kept rising. Mark Konyn, chief executive of RCM Asia-Pacific, discussed how the market would shape up.

How will the MPF market change?

Greater choice could bring industry consolidation. Konyn noted that giving members more choice might squeeze smaller providers out of the market under fee pressure — potentially reducing choice even as it was being expanded. Consolidation looked likely; the big would get bigger.

How do managers stand out?

Focus and a stable team are key. RCM had been a key MPF provider since the scheme’s inception, managing Hong Kong retirement funds since the mid-1980s. Konyn considered managing retirement funds a specialist capability, and its stable, dedicated Hong Kong team a key determinant of success.

For workers, consolidation is not necessarily bad: fewer providers could mean more concentrated service, but choice could narrow. In the employee-choice era, members who compare fund fees and performance benefit most. Compare providers’ funds with MPF fund search.