The Mandatory Provident Fund Schemes Authority (MPFA) and the Hong Kong Monetary Authority (HKMA) today (12 June) held a Launch Ceremony-cum-Exhibition for the E-Payment for MPF Transfer system to mark the system’s official debut.
The E-Payment for MPF Transfer system makes use of the HKMA’s Hong Kong dollar Real Time Gross Settlement system to automate payments for the transfer of Mandatory Provident Fund (MPF) accrued benefits between trustees. It shortens the time needed for the transfers, and enhances the accuracy and efficiency of the transfer process.
Speaking at the ceremony, MPFA Chief Operating Officer Alice Law said, “The MPFA has been enhancing the efficiency of the MPF System to reduce the operating costs of the System to benefit all scheme members. This includes promoting the use of electronic processing and services.”
With the introduction of the E-Payment for MPF Transfer system, the original trustee can transfer a scheme member’s redeemed benefits from the sale of MPF funds to the new trustee via this new platform, saving the time required to issue, mail, verify and cash cheques (please refer to the attachment for details of the operation).
Ms Law said, “We estimate that each of the 500,000 MPF transfers processed every year will be completed in two to three weeks’ time on average, about one week shorter than before. The out-of-market time is also expected to be shortened to about one week, reducing the risk of scheme members’ exposure to market fluctuations during the payment process, which may result in ‘selling low, buying high’. The E-Payment system will also help enhance the accuracy of the benefits-transfer process.”
The adoption of a single electronic platform by MPF trustees for processing transfers also facilitates the MPFA’s supervision of trustees, thereby offering better protection for scheme members, she added.
HKMA Executive Director Esmond Lee said, “The HKMA has been supporting and facilitating the development of systems for electronic payments to improve efficiency and bring convenience to the public. The cooperation between the HKMA and the MPFA in implementing E-Payment for MPF Transfer system is another example of such endeavor. The new system will further enhance the industry’s handling of the MPF transfer with greater efficiency and accuracy, so that all MPF scheme members will be able to manage their MPF investments more effectively.”
At today’s event, a number of MPF trustees demonstrated their electronic and online services for employers and scheme members.
To meet future challenges, the MPFA will continue to work with the HKMA and other parties to explore the possibility of using the existing financial infrastructure to further automate the operation of the MPF System and to make it paperless.
Separately, the MPFA is streamlining existing procedures for the convenience of scheme members. Taking the Employee Choice Arrangement (ECA) as an example, the MPFA today launched an enhanced transfer election form for ECA. There are only two pages for scheme members to fill in and the options have been simplified. The MPFA has also published a user guide on the steps for completing the new form and the key points to note.
Attachment: Key processes involved in making an MPF transfer
Mandatory Provident Fund Schemes Authority
Hong Kong Monetary Authority
12 June 2014
Alice Law, Mandatory Provident Fund Schemes Authority Chief Operating Officer (left) and Esmond Lee, Hong Kong Monetary Authority Executive Director (Financial Infrastructure) (right) officiate at the Launch Ceremony-cum-Exhibition for E-Payment for MPF Transfer.
MPF trustees introduce the electronic and online services provided to employers and scheme members to Alice Law, Mandatory Provident Fund Schemes Authority Chief Operating Officer (fourth from right) and Esmond Lee, Hong Kong Monetary Authority Executive Director (Financial Infrastructure) (third from right).
