SHANGHAI: China and taiwan will kick off the pilot scheme to get long-term retirement deposits in November, component of efforts to meet rising demand for pension products from an ageing population, the government said on Fri (Jul 29).
The announcement, jointly made by China’s central bank and the country’s banking regulator, came three months right after China launched the particular country’s first private pension scheme to tackle financial challenges in an aging society.
The retirement savings program is aimed at “further enriching financial products regarding old-age protection, and meeting diversified needs”, the People’s Financial institution of China as well as the China Banking plus Insurance Regulatory Commission payment (CBIRC) said.
China’s “Big Four” state banks will start the year-long demo in five Chinese language cities including Hefei, Guangzhou, Chengdu, Xi’an and Qingdao, the particular statement said.
The pilot retirement deposit products have maturities of 5, 10, 15 and 20 years, with person deposits capped with 500, 000 yuan (US$74, 231. 33) at each bank.
Under China’s personal pension scheme, money held in individual pension accounts can be invested in a range of financial products including deposits, prosperity management products and shared funds.
Within 20 years, 28 per cent of China’s people will be more than 60 years old, up from 10 per cent today, making it one of the most rapidly-ageing populations in the world, based on the World Health Business.
Independent consultancies estimate China’s private pension market can grow to a minimum of US$1. 7 trillion by 2025, through US$300 billion presently.