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Peru's newest private pension fund AFP Prima will officially open for business on August 8 intending to charge the lowest commission rate in the private pension fund system.
Prima's rate of 1.5% will be some 33% lower than the average AFP's commission rate, José Hung, investor relations manager for Prima's parent company, financial services holding Credicorp (NYSE: BAP) told BNamericas.
"We hope that our offer will force the rest of the AFPs to reduce their commissions to benefit the 3.5 million affiliates in the private pension fund system, who will have more of their income to spend," local daily Gestión reported Rubén Loaiza, the new Prima CEO, as saying.
The commission rates could go even lower, thanks to rules set out by Peru's banking and insurance regulator SBS that allow AFP's to offer permanency plans with lower rates.
Prima has presented a permanency plan that is currently being evaluated by the SBS, Loaiza reportedly said.
One of Peru's other private pension funds, AFP Integra, has decided to lower its commission rate and is expected to announce the new rate in the near future, Gestión reported.
The rates charged by Peru's other AFP are as follows: ProFuturo (2.45%), Unión Vida (2.27), Horizonte (2.25%), and Integra (2.1%).